In 2008 and 2009, the federal government spent tax dollars at a frenzied pace to try to rescue the nancial

markets from its own mismanagement. Troubled Asset Relief Program (TARP) outlays could reach $1 trillion or 7 percent of the nations gross domestic product. TARP was originally enacted so the government could buy risky or nonperforming loans from nancial institutions. But the mission changed within weeksthe government began using the funds to buy equity positions in nancial institutions, presumably to inject cash directly into these entities. An oversight panel concluded that $350 billion of the TARP funds cannot be adequately accounted for. The Federal Reserve also provided assistance of $30 billion for Bear Stearns, $150 billion for AIG, $200 billion for Fannie Mae and Freddie Mac, $20 billion for Citigroup, $245 billion for the commercial paper market, and $540 billion for the money markets. It is poised to lend over $7 trillion to nancial institutions, or over half the size of the entire American economy in 2007. According to Bianco Research president James Bianco, the federal bailout far exceeds nine of the costliest events in American history combined: Event Marshall Plan Louisiana Purchase Race to the Moon S&L Crisis Korean War The New Deal Invasion of Iraq Vietnam War NASA Cost Ination-Adjusted Cost $12.7 billion $115.3 billion $15 million $217 billion $36.4 billion $237 billion $153 billion $236 billion $54 billion $454 billion $32 billion (est.) $500 billion (est.) $551 billion $597 billion $111 billion $698 billion $416 billion $851.2 billion

TOTAL Over $3.9 trillion.23 The entire cost of World War II to the United States was $288 billion, or $3.6 trillion when adjusted for ination. Congress also passed, and President George W. Bush signed, scal spending bills to try to alleviate the economys ills, such as the $152 billion Economic Stimulus Act of 2008 and the $300 billion Housing and Economic Recovery Act of 2008. Congress and President Barack Obama are upping the ante by hundreds of billions more or so with the so-called American Recovery and Reinvestment Plan of 2009. The Wall Street Journal reports that when stimulus and bailout spending is combined, the federal spending share of GDP will climb to 27.5%. Put another way, more than $1 of every $4 produced by the economy will be consumed or controlled by the federal government. The Journal also notes that all of this is fast pushing the U.S. to European spending levels, and thats before Obamas new health-care entitlements.