Taxpayers are "extremely unlikely" to recoup the $700 billion the government spent to bail out the nation's banks and other institutions, special inspector general Neil Barofksy says.
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Nearly one year after Congress approved the $700 billion financial bailout, it was attacked by Republicans and fiscal watchdogs as an expensive failure that has not stopped home foreclosures or jobs from disappearing.
"This has been a failed program," Sen. Mike Johanns, R-Neb., said at today's Senate Banking committee hearing. "The very promises made to the taxpayer of what was going to happen with this money, in my judgment, have not been kept."
Johanns cited what he called "very damning" testimony by the bailout's Special Inspector General Neil Barofsky that said it is "extremely unlikely" that American taxpayers will get a full return on their $700 billion investment. Moreover, Barofsky observed, the Troubled Asset Relief Program has failed to increase bank lending, stop rising unemployment, or stem the rash of home foreclosures.
"In the last year," said the Congressional Oversight Panel's Elizabeth Warren, "the apprehension that pervaded this country has turned into something else: frustration and anger. Today's fragile stability has come at an enormous cost to the American people." Barofsky noted that "a lot of this frustration and cynicism and anger comes out of the lack of transparency in the TARP program." This, he said, was his group's "biggest frustration" with the Treasury Department and "one of the great failures of the past year."
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