The Democrats got the fist leg of their stimulus package through with an eye-popping price tag of $819 billion, but that figure pales in comparison to the numbers being thrown around when it comes to another bailout for the banks. Estimates for what the Obama administration is considering have swiftly moved past the remaining $350 billion left in TARP money and now range between $1 trillion and $4 trillion!
Continue reading below
Early estimates put the plan at $350 billion to $1 trillion, according to
The Deal's Bill McConnell, but those estimates have already started to race higher. The Wall Street Journal
reports
that "government officials seeking to revamp the U.S. financial bailout
have discussed spending another $1 trillion to $2 trillion to help
restore banks to health, according to people familiar with the matter."
While Fortune magazine
reported a number as
high as $4 trillion.
While it unlikely that a $4 trillion aid package will get passed (does
anyone have that much political capital?) it seems very likely that
President Obama will be headed back to Congress for more money to prop
up the banks. And with Republicans voting solidly against the stimulus
package, Obama may have a tough time selling another bank bailout to
the taxpayers, especially when the numbers are in the trillions. The first bailout -- the TARP program -- is already pretty unpopular and often seen as a boondoggle of Wall Street putting one over on Uncle Sam. Nor
has Wall Street really helped its cause by paying out millions in bonus money and retention packages, both of which have done little to endear it
to the average American. -
George White
See Pipeline story on banking sector rescueSee WSJ story
See Fortune story
See Dealscape post on Wall Street appearances
