If you want a clear sign that we’ve lost control of the bailout of the financial sector, look no further than the news that General Electric has been approved to take itself out of the US government-backed debt program.



Under the program—which is officially known as the Temporary Liquidity Guarantee Program—GE has borrowed billions of dollars insured by the FDIC. The upper limit of the guaranteed debt was an astronomical $126 billion. Now it’s being brought down to $75 billion.



So does this mean taxpayers are off the hook? Hardly



"The market knows the U.S. government will stand behind GE and GE Capital if necessary," Mirko Mikelic, a portfolio manager at Fifth Third Asset Management, tells Reuters. "It removes any U.S. government oversight while keeping the implicit guarantee."



You see, even though GE isn’t officially borrowing under the TLGP, the market understands that it is bound to be bailed out if trouble strikes again. We’re trapped in a bailout policy whether we want it or not.