TARP taxpayer commitment $2.9 trillion

At $2.9 trillion, the total risk to taxpayers of the financial bailout package Congress passed last year dwarfs the original $700 billion cost of the program, a watchdog office said on Tuesday.

The special inspector general appointed to oversee the bailout package, the Troubled Asset Relief Program (TARP), said that the $700 billion does not include the additional financing and associated programs run by the Federal Reserve and Federal Deposit Insurance Corporation. Once it is all added together, the $700 billion sum balloons to $2.9 trillion in taxpayer commitments.

The federal government, and the central bank in particular, have set up a series of additional funding programs that boost the total government commitment to well in excess of $10 trillion. The programs under the inspector general's jurisdiction, however, amount to $2.9 trillion.

"$2.9 trillion is just short of what the entire federal government spent in fiscal year 2008," said Senate Finance Committee chairman Max Baucus (D-Mont.). "It’s like having a second United States government budget, dedicated solely to saving the financial system. And that is truly surreal."

Neil Barofsky, the inspector general, said the money under his oversight covers 11 programs.

"History teaches us that an outlay of so much money in such a short period of time will inevitably attract those seeking to profit criminally," Barofsky testified in prepared remarks.

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