Congressional Budget Office estimated in a report issued Thursday afternoon.
The now-infamous TARP, the Troubled Asset Relief Program, is on pace to have disbursed $438 billion of the $700 billion authorized by Congress in October 2008, when panic threatened to bring down the entire banking system. Those funds were distributed to large and small banks, failed insurance giant AIG and automakers General Motors and Chrysler, along with programs aimed at helping homeowners avoid foreclosures.
The total estimate of the budgetary cost of TARP is up $6 billion from last year's mandated report, because of higher anticipated spending on housing programs.
In fall 2008, when Congress passed the bailout package and President George W. Bush signed it into law, the federal government was taking on an enormous amount of risk. A total bill of $27 billion, according to the CBO, would be "near the low end of the range of possible outcomes anticipated when the program was launched." Other assistance to failing companies, including emergency loans from the Federal Reserve, helped limit the costs to taxpayers stemming from TARP.
Most of the $27 billion bill comes from the bailouts of AIG and the automakers, which together will end up costing taxpayers $29 billion, along with the Home Affordable Mortgage Program, which was meant to help loan servicers modify homeowners' mortgages to avoid foreclosures.
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