NUMBERS

Posted at 8:38 a.m. ET

We get some of our best information here at Urgent Agenda from informed readers. Reader Ray Cleveland alerts us to a remarkable set of statistics comparing the federal payouts being made to deal with today's financial crisis with payouts made in the past.  Consider:

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.

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.

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).

Bianco Research, which crunched the numbers, is often quoted in financial news stories.

Ray Cleveland goes on to note a Bloomberg report that the total bailout this time represents $24,000 for every man, woman and child in the United States. 

It seems to me that Americans, including many journalists, still don't understand the enormity of the federal bailouts and the implications for our economic system.  The federal government now has equity stakes in major American banks and corporations.  True, it can get some or all of the money back in the future, as the economy grows once more - if it grows.  There are no guarantees. 

And we are far from out of the woods.

November 26, 2008.