By Peter Schroeder - 04/17/14 03:12 PM EDT
The cost of the government’s bailout programs has climbed $6 billion to $27 billion, according to the latest analysis from the Congressional Budget Office.
The congressional scorekeeper reported Thursday that the ultimate cost of the Troubled Asset Relief Program would be somewhat higher than its last estimate in May 2013. That’s because the CBO estimated that the amount the government would spend on housing relief efforts contained in the program would be $10 billion higher, while the costs of the government’s assistance to the auto industry fell.
The CBO’s price tag for the bailout is actually somewhat lower than the administration’s. The Office of Management and Budget estimates the final cost of TARP will come to $39 billion, primarily because it expects the government to spend billions of dollars more on housing programs than the CBO does.
The Treasury Department announced in 2011 that the bank portion of the bailout, while publicly reviled, actually turned a profit for the government. To date, Treasury estimates taxpayers have received a $28 billion profit on the bank rescue.
The CBO estimates that the only costly portions of the program were assistance to the insurance giant American International Group, which will likely cost $15 billion, and another $14 billion to rescue domestic auto companies. The CBO expects the government will spend $26 billion on housing programs, but that money was never intended to be repaid.
The administration has been quick to tout the success of the bailout program. While publicly unpopular, the program did help stabilize the financial system, and ended up costing a fraction of what was once expected. The government is still winding down smaller portions of the program.
“Treasury has made significant progress towards winding down the programs that helped prevent the economy from falling into a second Great Depression, and we will continue to balance the speed of our exit with maximizing returns for taxpayers,” said Timothy Bowler, Treasury’s acting assistant secretary for financial stability, earlier this month.