TARP: The Best Federal Program Despised By The Public?

Rarely, Robert Samuelson writes, does Washington deliver “a major program that achieves its goals at a tiny fraction of its estimated costs.”  But that’s the story with TARP – the Troubled Asset Relief Program, created to stabilize markets during the 2008 financial crisis.  According to Samuelson:

  •         TARP used only $410 billion of its authorized $700 billion.
  •         Most TARP funds have already been or will be repaid.  The Congressional Budget Office once estimated TARP’s ultimate cost at $356 billion; the current estimate is $19 billion.
  •         Of the $245 billion in TARP funds invested in banks, the Treasury has already recovered about $244 billion, including interest payments, dividends and cash from sold bank stock warrants.
  •         When TARP’s remaining bank investments are closed, the Treasury expects an overall profit of about $20 billion.
  •        The Treasury expects to recover about $65 billion of its $80 billion investment in GM and Chrysler.  And the sale of its 92 percent stake in AIG may “yield a small profit.”

While many taxpayers believe we “spent $700 billion and got nothing in return,” Douglas Elliott of the Brookings Institution calls TARP “the best large federal program to be despised by the public.”