U.S. financial bailout plan critical to economic recovery

WASHINGTON (Xinhua) – The financial rescue program launched two years ago has played a critical role in rebuilding confidence of the financial sector, the U.S. Treasury Department said on Tuesday.

In its Retrospective Report on the Troubled Asset Relief Program (TARP) to the Congress, the Treasury said that the plan ” played a critical role in stabilizing the financial sector and restarting credit markets, so that our nation’s economy could recover.”

The 700-billion-dollar program, which was launched in late 2008 after the global financial crisis burst, injected government investment into many big financial institutions.

The report provides a comprehensive overview of the steps that Treasury took under TARP to contain a growing financial panic that gripped the country in late 2008 and early 2009.

The department said that the program made great contribution in recapitalizing the financial sector and restarting the credit markets, which made it possible for businesses, municipalities, and families to borrow again, so that our economy could recover.

According to the report, Treasury now estimates that the total cost of TARP will be about 50 billion U.S. dollars.

However, critics said that the TARP was a waste of taxpayers’ money and added new burden to the country’s already severe fiscal deficit problem.