Skip to main content

CBO: Bailout Could Make Economy Worse

Scared yet?

The director of the Congressional Budget Office said yesterday that the proposed Wall Street bailout could actually worsen the current financial crisis.

During testimony before the House Budget Committee, Peter R. Orszag -- Congress's top bookkeeper -- said the bailout could expose the way companies are stowing toxic assets on their books, leading to greater problems.

'Ironically, the intervention could even trigger additional failures of large institutions, because some institutions may be carrying troubled assets on their books at inflated values,' Orszag said in his testimony. 'Establishing clearer prices might reveal those institutions to be insolvent.'