Tuesday, November 25, 2008
The Cost of the Bailout
Cory Doctorow Boings Barry Ritholtz's work that shows the cost of the bailout is more than the SUM of the costs of the Marshall Plan, the Louisiana Purchase, the Race to the Moon, the S&L Crisis, the Korean War, the New Deal, the (first) Iraq Invasion, the Viet Nam War and the lifetime budget of NASA.
Hard to believe. Here's the numbers:
Hard to believe. Here's the numbers:
• Marshall Plan: Cost: $12.7 billion, Inflation Adjusted Cost: $115.3 billionCost of Bailout, so far, including recent Citibank numbers: $4.62 trillion.
• 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
Technorati Tags: Economics
Comments:
Big numbers, but they assume that all debt/assets that the government is guaranteeing will go to zero -- a very naive assumption. To say that cost to date is almost $5 trillion is grossly in error -- that number is potential exposure over the course of the next several years. It is also possible, though in my view very unlikely, that the intervention will be a net positive for the US Treasury. In any case, in my view this kind of hype does not serve your credibility well.
Curt Carmack
Post a Comment
Curt Carmack
