What exactly am I getting for my $24,000?
After ranting about the disgusting amount of money that the U.S. government is flinging all over the place earlier today, I came across an updated total of approximately how much it has spent, now including the Citigroup transaction (but not today's announcement). Ready for this...$4.6165 trillion dollars!!!!
Barry Ritholtz provided some perspective on just how much money this is over on his Big Picture blog this morning. Adjusted for inflation, here is the cost of some famous events in history that the U.S. government has shelled out for:
• 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
Add all those HUGE events together and they still cost $686 billion less than what the government has shelled out to banks and other beggars thus far...and the spending seems to be accelerating, not slowing down. Heck, adjusted for inflation this bailout cost more than the entirety of World War II (only $3.6 trillion, adjusted for inflation)!
While WW II was terrible, at least the money was spent on manufacturing stuff, which created jobs. What in the heck are taxpayers getting for their money now? Oh that's right, we'll probably get most of this money back eventually and will even turn a profit on these "deals," which are much worse than those that investors like Warren Buffett are getting. Sure.
The unbelievable thing is that no one can even keep track of how much money the government is printing. Bloomberg estimates that it is much higher than the aforementioned number. It ran an article stating U.S. Pledges Top $7.7 Trillion to Ease Frozen Credit.
That's equivalent to $24,000 for person in the entire United States. The irony of this whole thing is that if the government had just handed a check for even half that much to every man, woman, and child in the country instead of doing who knows what with it the economy would probably actually be in better shape.
I can see it now, someone dressed up in an Uncle Sam suit could drive around from house to house handing out giant checks like they do for the Publisher's Clearing House sweepstakes. There would be balloons, confetti, etc. The resulting excitement would cause consumer confidence to soar. Heck even the process of giving out the checks would create jobs.
At least this stupid idea would have stimulated a lot of consumer demand for cars, housing, jewelry, etc... Of course, doing that would have been perceived as stupid, but our genius leaders at the Fed and Treasury have been throwing the money down a big black hole instead.