The government confesses about taxpayer costs
The TARP is going to cost taxpayers more than was originally projected by the government. What a surprise.
This will be the first in dozens of resets in what Congress and the administration say the average person will be on the hook for as the economy gets worse and the size of the bailout grows. It means that the amount of people's incomes that are taxed will increase, if not not now, in the future.
According to Reuters, "U.S. congressional budget analysts have raised their estimate of the net cost to taxpayers for the government's financial rescue program to $356 billion, an increase of $167 billion from earlier estimates." How many people pay taxes in America? Maybe 100 million.
If GDP does not grow at the rate that the administration projects in the budget, the weight on the taxpayer will grow. If the cost of providing mortgage assistance is higher than expected, the taxpayer's burden gets heavier. And it gets worse if unemployment goes above 10 percent because there will be fewer people to tax.
Government is almost always too optimistic about the outcome of government programs, and the group that gets gored is always the same.
Douglas A. McIntyre is an editor at 24/7 Wall St.