Potential Cost of Mortgage Mess to Taxpayers Is Approaching $1 Trillion

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 |  Includes: AIG, FMCC, FNMA, LEH
by: Zubin Jelveh

The Congressional Research Service estimated in July that the Iraq War has so far cost $648 billion in current dollars.

While the government thus far during the credit crunch has committed to spending about $300 billion as a result of the recent housing bill, potential costs from other bailouts and loan programs could potentially put taxpayers on the hook for $901 billion, Reuters reports. Here is the sum of the housing bill, the bailouts of Fannie Mae (FNM), Freddie Mac (FRE), AIG (NYSE:AIG), Bear Stearns, and Lehman (LEH), as well as the Term Auction Facility loans currently lent:

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If you include the recent stimulus, the $500 billion written down so far by financial companies, and the potential costs from the growing possibility of a new government entity that would buy up "bad" debt (and not include opportunity cost), the total final private and public bill from the mortage mess is easily over $1 trillion and probably closer to $1.5 trillion.