Records sufficient to show the terms of the loans and the rates that the borrowers must pay…

Records, including contracts with outside entities, that show the employees or entities being used to price the relevant securities and to conduct” the lending process.

Who’s running the program? A simple question.

There are arguments against disclosure, of course, but the secrecy case here seems especially weak.

Banks oppose any release of information because it might signal weakness and spur short-selling or a run by depositors, said Scott Talbott, senior vice president of government affairs for the Financial Services Roundtable, a Washington trade group.

“You have to balance the need for transparency with protecting the public interest,” Talbott said. “Taxpayers have a right to know where their tax dollars are going, but one piece of information standing alone could undermine public confidence in the system.”

Barney Frank gives it a try, and comes across sounding foolish. Here’s what he says about the loans the banks:

“I talk to [New York Fed Chairman Tim] Geithner and he was pretty sure that they’re OK,” said Frank, a Massachusetts Democrat. “If the risk is that the Fed takes a little bit of a haircut, well that’s regrettable.” Such losses would be acceptable, he said, if the program helps revive the economy.

Pretty sure they’re okay? And here’s the argument for secrecy:

Frank said the Fed shouldn’t reveal the assets it holds or how it values them because of “delicacy with respect to pricing.” He said such disclosure would “give people clues to what your pricing is and what they might be able to sell us and what your estimates are.” He wouldn’t say why he thought that information would be problematic.

Actually, it’s more likely that visibility would help the market, as Bloomberg’s story points out:

Revealing how the Fed values collateral could help thaw frozen credit markets, said Ron D’Vari, chief executive officer of NewOak Capital LLC in New York and the former head of structured finance at BlackRock Inc.

“I’d love to hear the methodology, how the Fed priced the assets,” D’Vari said. “That would unclog the market very quickly.”

The fear for banks is misplaced. They already have the loans, so they’re fine. The real purpose of secrecy is hiding how badly—not banks—but taxpayers are in the hole.

From the Bloomberg suit:

The public has significant and legitimate interest in the Fed’s conduct with respect for these four lending facilities because the Fed’s assets are public assets. Taxpayers are entitled to understand and assets the decisions by the Fed on the valuation of the collateral it accepts as security for public money being lent to private institutions. The public’s interest is particularly pronounced in light of the new expansive powers of the Fed, the new risks that the Fed is taking with public money, and the ongoing financial crisis and its effects on the American economy.

As the public’s independent eyes and ears on the government, news organizations, can do no less than everything in their power to put a spotlight on these public expenditures. The power to tax and spend is probably government’s most basic one. Watching those, to me, is a news organization’s first order of business. It is Job One.

Freedom of Information Act requests are a commonplace newsgathering tool, and so, for that matter, are lawsuits to force disclosure when the law is violated. The Bloomberg suit is a reasonable, appropriate and measured tactic by a mainstream news organization. And the suit is manifestly in the public interest.

News organizations compete, but from time to time they cooperate on matters of press freedom and transparency. This is one of those times.

The suit is Bloomberg LP v. Board of Governors of the Federal Reserve System, 08-CV-9595, U.S. District Court, Southern District of New York (Manhattan).

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Dean Starkman Dean Starkman runs The Audit, CJR's business section, and is the author of The Watchdog That Didn't Bark: The Financial Crisis and the Disappearance of Investigative Journalism (Columbia University Press, January 2014). Follow Dean on Twitter: @deanstarkman.