The Congressional Budget Office is reporting new numbers as of the end of March as to the cost to taxpayers of the Troubled Asset Relief Program (TARP) and the report seems to be flying under the radar. Due to the Treasury’s move to use TARP funds to help avoid foreclosures – something that still burns me up – and its changing bailout plans for AIG and deteriorating financial conditions, the CBO had to adjust its original estimates of the cost to taxpayers. Originally the CBO reported that it would cost us $189 billion. Now it is saying the cost will be $356 billion. That is an increase of $167 billion.
The Wall Street Journal explains it like this, “The CBO estimates the program’s ultimate cost using techniques similar to those generally applied to federal loans and loan guarantees, and adjusts for market risk. More precisely, it puts the net cost to taxpayers at the difference between what Treasury pays for investments or lends to firms and ‘the present value, adjusted for market risk of any future earnings from holding purchased assets and the proceeds from their eventual sale’.”
Total deficit as projected in March is :-1,667 -1,139 -693 -331 -300 -310 -282 -327 -312 -325 -423 -2,772 -4,441. These numbers are in billions and the range is by the year starting in 2009 and going to 2019. The last two numbers are total for 2010-2014 and 2010-2019 respectively. That’s a total deficit of $4.4 trillion dollars. There is no halving of the deficit either as the President “promises” to do.