2009 Oct
Can you correctly match these Federal capital expenditures to what they cost taxpayers (in inflation-adjusted totals)?
| Reorder these events | To match these real costs |
| World War II | $115.3B |
| The New Deal | $217B |
| Vietnam War | $237B |
| Total cost of NASA | $256B |
| Louisiana Purchase | $454B |
| Bailout Costs | $500B |
| Marshall Plan | $597B |
| Korean War | $698B |
| Race to the Moon | $851.2B |
| S&L Crisis | $3.6T |
| Invasion of Iraq | $11.6 trillion |
Check your answers.
Here are the events, in order of ascending capital expenditures, adjusted for inflation.
| Events in order of actual costs | |
| Marshall Plan, | $115.3B |
| Louisiana Purchase, | $217B |
| Race to the Moon, | $237B |
| S&L Crisis, | $256B |
| Korean War | $454B |
| New Deal | $500B |
| Invasion of Iraq | $597B |
| Vietnam War | $698B |
| NASA | $851.2B |
| WWII | $3.6T |
| Bailouts | $11.6 trillion |
To put the last item, the bailouts, in perspective, the $11.6T pricetage exceeds the total of all the other items by more than $4 Trillion!
(Our thanks to Barry Ritholtz where we got the numbers for this quiz from his blog post.)
October 13th, 2009 at 1:40 pm
Get your numbers together. These are so blatantly FALSE I hardly know where to start. the S&L crisis was really a BAILOUT and in 1990 the costs had already surpassed 500 billion in 1990 dollars.
Iraq is under 600 bill? Try 1 trill and growing.
Jeez you guys could use a little remediasl math!
October 13th, 2009 at 3:01 pm
The bailout number isn’t comparable to the others. First, it’s not a taxpayer expenditure. Much of what Mr. Ritholtz included (actually the Fed included) was commitments by the Federal Reserve to prop up the mortgage market. We can debate whether that is good policy, but it’s not backed by tax dollars. It’s backed by fiat dollars.
They didn’t tax Peter to pay Paul, they just turned on the printing press and made more money.
Second, much of the “bailout” has been direct government investment in going concerns. In the case of several banks, the taxpayers have already realized a profit on those investments.
Of course on others, GM and AIG for example, there is virtually no hope of receiving a profit, and slim hope of getting even dollars back on those “investments”, but until the profit-loss statement is finally accounted for, we’ll have no idea if these bailouts/investments will have a positive or a negative effect on the taxpayers as a whole.
And as for the inflationary policies of the Fed, they have largely been implemented to forestall deflation, so if they’re successful, and if the money can be extricated from the economy in time, then it’s possible we’ll not have any meaningful inflation as a result of those policies.
The one thing that IS certain is that the bailouts will not cost $11.6T, and will possibly be $10T or more less than that figure.
October 14th, 2009 at 9:07 am
A3K’s comments are well taken. It would appear that Mr. Ritholtz may have fallen in the same trap for the S&L crisis, since the actual total when one includes the repayments/sales out of Resolution Trust suggest that the Fed actually made a small overall profit, although not on an inflation adjusted basis.