I came across an interesting article written by Barry Ritholtz about the true cost of the current bailout by the US government. Most people have a hard time comprehending the true cost of this “Mother of all bailouts” and what it means for our children and generations beyond. According to Ritholtz,
If we add in the Citi bailout, the total cost now exceeds $4.6165 trillion dollars. People have a hard time conceptualizing very large numbers, so let’s give this some context. The current Credit Crisis bailout is now the largest outlay In American history.
Jim Bianco of Bianco Research crunched the inflation adjusted numbers. The bailout has cost more than all of these big budget government expenditures – combined:
• Marshall Plan: Cost: $12.7 billion, Inflation Adjusted Cost: $115.3 billion
• Louisiana Purchase: Cost: $15 million, Inflation Adjusted Cost: $217 billion
• Race to the Moon: Cost: $36.4 billion, Inflation Adjusted Cost: $237 billion
• S&L Crisis: Cost: $153 billion, Inflation Adjusted Cost: $256 billion
• Korean War: Cost: $54 billion, Inflation Adjusted Cost: $454 billion
• The New Deal: Cost: $32 billion (Est), Inflation Adjusted Cost: $500 billion (Est)
• Invasion of Iraq: Cost: $551b, Inflation Adjusted Cost: $597 billion
• Vietnam War: Cost: $111 billion, Inflation Adjusted Cost: $698 billion
• NASA: Cost: $416.7 billion, Inflation Adjusted Cost: $851.2 billion
TOTAL: $3.92 trillion. That is $686 billion less than the cost of the credit crisis thus far.
Isn’t that astounding? That’s beyond normal comprehension. Ritholtz further add that,
The only single American event in history that even comes close to matching the cost of the credit crisis is World War II: Original Cost: $288 billion, Inflation Adjusted Cost: $3.6 trillion
The $4.6165 trillion dollars committed so far is about a trillion dollars ($979 billion dollars) greater than the entire cost of World War II borne by the United States: $3.6 trillion, adjusted for inflation (original cost was $288 billion). Go figure: WWII was a relative bargain.
No matter how you look at this, the amount of money that will dig us out of this financial mess is mind boggling and it isn’t over yet. Why isn’t the Congress seeking to bring up President Bush and his marauding posse up on crimes? I am sure there is ample evidence of gross mismanagement and crimes on their heads.
Filed under: Bailout Biggest Government Expenditure In History, Credit Crisis, Credit Crisis Bailout, Economic Crisis, Financial Crisis, Government Bailout, Louisiana Purchase, Marshall Plan
Black Political Thought 