WASHINGTON – Congress' independent budget agency says the cost to taxpayers of the contentious $700 billion financial rescue has dwindled down to $25 billion.
The Congressional Budget Office estimates that as of this month the government will recoup most of the money spent. The $25 billion represents unrecovered money spent to bail out insurance giant American International Group and automakers Chrysler and GM. All three, however, have paid back some of their rescue money.
The payback outlook is far rosier than it was in August when CBO forecast losses of $66 billion and in March when it foresaw losses of $109 billion.
In a report issued Monday, CBO said the brighter prospects are the result of repurchases of preferred stock by recipients of bailout funds, a lower estimated cost for assistance to AIG and to the automotive industry, and lower participation in mortgage assistance programs.
The bailout fund, known as the Troubled Asset Relief Program, became hugely unpopular with the public and in Congress. Advocates and even some critics, however, credit it for stabilizing the financial sector in the wake of Wall Street's meltdown in 2008.