The Bailout: Historical Comparisons

Ever stop and try to put financial figures from the current economic crisis into perspective? Does $700 Billion really mean anything to you? How about $4.6 Trillion, which is what our government has already pledged toward the credit crisis?

Well, Barry Ritholtz has taken time to bring these large figures into perspective. Below you’ll find a list of major costs throughout U.S. history. The first figure is the cost at the time of the expenditures and the second figure is the cost in today’s dollars.

Be afraid, be very afraid.

• Marshall Plan: Cost: $12.7 billion, Inflation Adjusted Cost: $115.3 billion

• Louisiana Purchase: Cost: $15 million, Inflation Adjusted Cost: $217 billion

• Race to the Moon: Cost: $36.4 billion, Inflation Adjusted Cost: $237 billion

• S&L Crisis: Cost: $153 billion, Inflation Adjusted Cost: $256 billion

• Korean War: Cost: $54 billion, Inflation Adjusted Cost: $454 billion

• The New Deal: Cost: $32 billion (Est), Inflation Adjusted Cost: $500 billion (Est)

• Invasion of Iraq: Cost: $551b, Inflation Adjusted Cost: $597 billion

• Vietnam War: Cost: $111 billion, Inflation Adjusted Cost: $698 billion

• NASA: Cost: $416.7 billion, Inflation Adjusted Cost: $851.2 billion
TOTAL: $3.92 trillion

“The only single American event in history that even comes close to matching the cost of the credit crisis is World War II: Original Cost: $288 billion, Inflation Adjusted Cost: $3.6 trillion” Full Text

To continue to put things into perspective, it’s helpful to realize that in 1992, the world’s debt was equal to its GDP. Today, the world’s total debt is 3.7 times the GDP.