Bailouts Could Cost $23 TRILLION

Say Goodbye To Your Money!
Say Goodbye To Your Money!

Are you ready for this boys and girls?  We knew this was coming…and we are already broke.

Neil Barofsky, is a special inspector general  testifying to the House oversight committee tomorrow, (Tuesday 7.21.09),  and the prospects are dim considering “they” always lowball the figures.

Bailouts could cost U.S. $23 trillion

A series of bailouts, bank rescues and other economic lifelines could end up costing the federal government as much as $23 trillion, the U.S. government’s watchdog over the effort says – a staggering amount that is nearly double the nation’s entire economic output for a year.

If the feds end up spending that amount, it could be more than the federal government has spent on any effort in American history.

For the government to be on the hook for the total amount, worst-case scenarios would have to come to pass in a variety of federal programs, which is unlikely, says Neil Barofsky, the special inspector general for the government’s financial bailout programs, in testimony prepared for delivery to the House oversight committee Tuesday.

The Treasury Department says less than $2 trillion has been spent so far.

If $2 Trillion has been spent so far, what about the $9 Trillion the Fed’s IG cannot account for?

Still, the enormity of the IG’s projection underscores the size of the economic disaster that hit the nation over the past year and the unprecedented sums mobilized by the federal government under Presidents George W. Bush and Barack Obama to confront it.

In fact, $23 trillion is more than the total cost of all the wars the United States has ever fought, put together. World War II, for example, cost $4.1 trillion in 2008 dollars, according to the Congressional Research Service.

Even the Moon landings and the New Deal didn’t come close to $23 trillion: the Moon shot in 1969 cost an estimated $237 billion in current dollars, and the entire Depression-era Roosevelt relief program came in at $500 billion, according to Jim Bianco of Bianco Research.

The annual gross domestic product of the United States is just over $14 trillion.

Treasury spokesman Andrew Williams downplayed the total amount could ever reach Barofsky’s number.

“The $23.7 trillion estimate generally includes programs at the hypothetical maximum size envisioned when they were established,” Williams said. “It was never likely that all these programs would be ‘maxed out’ at the same time.”

It was also not likely that Americans would lose $1.3 Trillion of their personal wealth in the first quarter of this year, but it happened.

So let’s say the bailouts “only” come to $12 Trillion; aren’t we still using red crayon math?

And then there is this from WSJ:

Treasury Is Criticized Over TARP

WASHINGTON — The special inspector general overseeing the $700 billion financial-sector bailout said the Treasury Department isn’t disclosing enough information about how taxpayer money is being spent.

In prepared testimony for a Tuesday hearing of the House Committee on Oversight and Government Reform, Special Inspector General Neil Barofsky said the Treasury has rejected several of his recommendations for more transparency on its part.

Mr. Barofsky also said the Treasury has declined to require bailout recipients to explain what they are doing with their government funds.

Mr. Barofsky is pushing for the Treasury to provide more frequent valuations of a portfolio of assets it has obtained in connection with the TARP. He said the department hasn’t committed to providing such reports more than the once a year required by law.”Treasury’s default position should always be to require more disclosure rather than less and to provide the investors in TARP — the American taxpayers — as much information about what is being done with their money as possible,” Mr. Barofsky will tell lawmakers.

The special inspector general’s office collected its information by surveying 364 institutions that had completed agreements to receive government aid as of Jan. 31. The office didn’t attempt to independently verify the information provided by the institutions, the report said.

The report provides a broad glimpse at how TARP recipients used federal capital. It shows 43% of the banks used the money to meet capital or reserve requirements set by regulators. Four percent used it to complete acquisitions, often in transactions facilitated by the Federal Deposit Insurance Corp. About a quarter reported investing in mortgage-backed securities affiliated with federal housing agencies, and 14% reported using the money to pay down other debt obligations.

The report cited 80% of respondents as using the money in ways that supported their ability to lend. More than 100 institutions said they used the funds to support residential mortgage loans. Sixty-one banks reported using the funds to support other forms of consumer lending.

If all of these institutions are “using the money in ways that supported their ability to lend”, then why is the credit market still frozen?  Why are Americans losing their jobs and homes?

And as my spousal unit has stated; Joe Biden saying that we will make $1.50 for every dollar we spend only happens when you are a coke dealer.

9 thoughts on “Bailouts Could Cost $23 TRILLION

  1. Ahhh, the magic elixir of OPM. Why just a little will renew your car, make your house more user-friendly, cut your energy costs down to manageable levels, and give your kids a free world-class education. Yes indeedy – OPM – just what Dr. Obummer ordered!

    So where do we get this OPM – simple, Dr. Obummer will just take it from your family, friends, and neighbors, after all they too have Other People’s Money!

  2. Yes, Diamond, my brain does hurt already. It has been hurting for a while now, and everytime I hear Obama’s voice, or see his disgusting face it hurts more. Ditto to Tim Geithner and Ben Bernanke.

    As for anything else concerning this administration – Ditto!

    Turns out the case of flu I thought I had seems to be swine flu. It just won’t go away, and the Dr. doesn’t know how to treat it, except with antibotics which didn’t help diddly squat. I think we’re being sprayed with something to keep us from being well enough to speak our minds. Sometimes I feel like I’m out in space and can’t see any way back, but rest assured that when my head clears I’ll be back meaner than ever.

    I’m still reading, but just don’t feel like commenting too much lately, but I’ll be back, Diamond, I’m one of your biggest fans. Keep after them, Tiger.

  3. Lee – get with the Dame over at DameTruth – she got the mojo for elixirs on getting better.

    As for being sprayed – who knows – I am sick all the time because of the vog coming out of the volcano….so I wouldn’t know.

    And as for keeping their feet to the fire – NO PROBLEM!
    Thanks for the encouragement!

    YOU GET BETTER!!!

  4. Pingback: Diamond Tiger
  5. Lee M,
    My grandson had swine flu the other week and his doctor gave him Tamiflu which helped. He got over it pretty quickly.

    Can we throw the usurper and all of his cronies out yet? I say let’s do it!!

  6. OFF TOPIC- but important info:
    lee M- and everyone else: Re: health and swine flu.

    Everyone needs to research H2O2 (hydrogen peroxide). Do a ixquick or Google search, the info you find will be amazing!

    It is just water with an extra oxygen molecule. Virus, bacteria, and cancer cells CAN NOT exist in an oxygen rich environment. The more oxygen you get into your system, the less vulnerable you are. This is the SECRET that the doctors do not know and is very well kept because you will generally not need them.

    I get 35% FOOD grade H2O2, cut it 10 parts distilled water to one part H2O2, and put it onto a misting spray bottle. Exhale deeply, then as I inhale deeply I mist it directly into my mouth and lungs, 4 to 5 pumps on the mister. Do this once or twice a day. It cleans your lungs and greatly enriches your oxygen levels in your blood. It will make you unable to host the flu, for it can not exist in an oxygen rich environment. I also keep an eye dropper of 35% H2O2 on my counter, and I drink several glasses of water a day with 3-4 drops in the glass. This keeps the gut flora healthy and also aids in keeping the body flushed with oxygen.

    If you have the flu, get oregano, rosemary, and thyme. Put a pinch of each into a small pot of rapidly boiling water and inhale deeply for several minutes. This will lessen the symptoms and make you feel better.

  7. Thanks everyone – To Practical Madman, thanks for the tip on hydrogen peroxide I always keep some on hand, and will take your advice beginning now.

    That’s one of the things I love about the Monster’s blog. Her readers are always so helpful and caring – just like she is.

  8. My peroxide isn’t labeled Food grade so I will have to get out tomorrow and buy some. I am anxious to start this remedy.

  9. Pingback: Lyn Su

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