Tim Geithner projected yesterday that the final cost of the $700 billion TARP program — as unpopular as ever — will be under $50 billion*, and Jackie Calmes writes that it "could conceivably earn taxpayers a profit."This was considered by one article (source forgotten) as the most recent bipartisan program. And it worked great. Well, it worked to stave off economic collapse. It failed politically--that politicians have gotten heaps of blame even though it will net a small cost or even perhaps a gain. There is no reward for prevention. We knew that, but this situation will provide a glowing example for the next generation of politicians--better to cower in fear of a reaction than do something that is costly in the short term but beneficial in the medium to long term.
A reader sends over another story from today's Times to put that in perspective: Ireland just took over a bank in an intervention that will put the total tab for propping up the banking sector alone at $68 billion. That's for a country with a population of 4.5 million — a bit more than 1 percent of the population of the United States.
The government obviously took a range of actions and spent a lot of money around the financial crisis. But it is increasingly hard to argue that TARP should be seen — as it still is — as some kind of original fiscal sin.