Citigroup backstop adds to massive taxpayer burden

According to Bloomberg, the rescue of Citigroup announced Sunday adds even more of a burden to taxpayers already on the hook for a staggering amount of debt.
The rescue, which includes a government guarantee of $306 billion in toxic assets, brings the total amount of money provided by the government on behalf of taxpayers to $7.7 trillion.

The unprecedented pledge of funds includes $3.18 trillion already tapped by financial institutions in the biggest response to an economic emergency since the New Deal of the 1930s, according to data compiled by Bloomberg. The commitment dwarfs the plan approved by lawmakers, the Treasury Department’s $700 billion Troubled Asset Relief Program. Federal Reserve lending last week was 1,900 times the weekly average for the three years before the crisis.

Some members of Congress say the Citigroup rescue is another example of the Federal Reserve overstepping its authority. They argue that there has not been enough transparency in the government's rescue actions.

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