WASHINGTON — The Obama administration probably will make a profit on all the bailout money spent to prop up banks and other companies, as well as struggling homeowners, devastated by the Great Recession, according to the latest federal projections.
Over the next 10 years, the taxpayer-funded bailouts could produce as much as $163 billion in profits, in a best-case scenario, from repayments, stock sales, dividends and interest paid by banking and insurance firms, auto companies and mortgage finance companies.
That's a stark turnaround from predictions of hundreds of billions in losses in the immediate aftermath of the unprecedented aid, starting at the end of the George W. Bush administration.
The projections were sketched out in a Treasury report released Friday that highlighted the positive effect of the response to the financial crisis by the Bush and the Obama administrations.
Senior Treasury officials said they wanted to dispel misperceptions that the controversial bailouts, including the $700-billion Troubled Asset Relief Program, have been ineffective and costly.
"Collectively, these programs — carried out by both a Republican and a Democratic administration — were effective in preventing the collapse of the financial system, in restarting economic growth and in restoring access to credit and capital," Timothy Massad, Treasury's assistant secretary for financial stability, wrote in a blog post Friday.
Over the next 10 years, the taxpayer-funded bailouts could produce as much as $163 billion in profits, in a best-case scenario, from repayments, stock sales, dividends and interest paid by banking and insurance firms, auto companies and mortgage finance companies.
That's a stark turnaround from predictions of hundreds of billions in losses in the immediate aftermath of the unprecedented aid, starting at the end of the George W. Bush administration.
The projections were sketched out in a Treasury report released Friday that highlighted the positive effect of the response to the financial crisis by the Bush and the Obama administrations.
Senior Treasury officials said they wanted to dispel misperceptions that the controversial bailouts, including the $700-billion Troubled Asset Relief Program, have been ineffective and costly.
"Collectively, these programs — carried out by both a Republican and a Democratic administration — were effective in preventing the collapse of the financial system, in restarting economic growth and in restoring access to credit and capital," Timothy Massad, Treasury's assistant secretary for financial stability, wrote in a blog post Friday.
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