Great news for taxpayers: Recoupment under TARP for The Big Bailout

In case you are still worried that taxpayers will foot the bill for the $700 billion banking bailout, take a look at Section 134, "Recoupment", in the TARP proposal:

SEC. 134. RECOUPMENT.

Upon the expiration of the 5-year period beginning upon the date of the enactment of this Act, the Director of the Office of Management and Budget, in consultation with the Director of the Congressional Budget Office, shall submit a report to the Congress on the net amount within the Troubled Asset Relief Program under this Act. In any case in which there is a shortfall, the President shall submit to the Congress a legislative proposal that recoups from entities benefitting from the program an amount equal to the shortfall in order to ensure that the Troubled Asset Relief Program does not add to the budget deficit or the national debt.

Whether this provision will work out in reality remains to be seen, but at least it is a solid stab at protecting the pocketbooks of taxpayers.

The basic idea is that taxpayers will likely make money on this deal over a five-year period, but in the event that this fails to happen, the bailed-out banks will have to come up with the difference.

-- Jack Krupansky