TARP Inspector: Taxpayers Really Are On The Hook For $24 Trillion In Bailout Spending
Earlier this week I posted news about taxpayer commitments under the various federal bailout/economic rescue programs reaching $23.7 trillion. When that news hit the Obama administration was quick to dismiss the figure as inflated, but the guy responsible for it, the inspector general for the TARP program, isn’t backing down.
He says it’s very, very real.
Barofsky told us that the Treasury Department “is not being transparent with respect to the TARP,” the $700 billion in funds (and more) the government is using as loans and bailouts to help stabilize the financial markets. “They’ve failed to adopt some very basic recommendations we’ve had toward transparency,” he said.
Called the “SIGTARP,” Barofsky appeared before Congress this week and told them that the government’s commitment to fix the financial system could potentially reach $23.7 trillion, and criticized the Treasury Department for calling his team’s estimate “inflated.”
“I think that the Treasury Department ought to read the report before they make comments, at least the spokesperson’s office,” Barofsky said. “Our methodology is laid out in black and white in the report. … As far as the numbers being inflated, where do you think we got the numbers from? We got it from the Treasury Department, we got it from the Federal Reserve. … If these numbers are inflated, it’s because they inflated them when they put them out in the public, not because of us.” …
“Perhaps their criticism is that we dare to do math,” he said. He added that his team tried to convince the Treasury that they were wrong, and that recipients should be required to report on how they use the federal funds, and those should be shown to the American people so that they know it’s “not being thrown into a black hole.”
Of course, just because the taxpayers are committed to $23.7 in economic rescue doesn’t mean all that spending will happen. But with the economy going the way it’s going, and with our debt situation already precarious (to put it mildly) and getting worse, we can’t really afford to role the dice in committing ourselves to a potential level of spending that’s twice our nation’s yearly GDP can we?
Apparently the Obama administration thinks we can. But then the Obama administration is also ok with running up what will be roughly $2 trillion in debt in less than 200 days in office.



