Concerns about Wasteful Spending, but..

We are starting to hear about government waste in conjunction with the stimulus.

Back just a few months ago, we gave a $350 billion to banks. That is not the total of our spending and committments. Estimates as high as $7.8 Trillion has been committed to help save our economy.

The $7.8 trillion of spending does not include the additional stimulus necessary to get our economy moving. My estimate is that we will need $1.5T of additional spending. Yahoo has a breakdown of how the first 800B or so is going to be spent.

Now, we hear that the banks themselves think that their bad debts are going to be about $4T. This is not stimulus, or commitments that are already out there. So the total commitment is going to be over $11T to clean up the banks. This is actual cash money that someone will have to spend to make the banks solvent to avoid a second great depression. In this case, that someone will almost certainly be the U.S. taxpayer.

With numbers like $4T being thrown around, the actual stimulus of $1.4 trillion is small change. The waste people should be concerned about is on the side of banks, not on the side of government stimulus.