Last week Lisa Chiu, one of our colleagues at SubsidyScope.com, mentioned to us that the FDIC’s deposit insurance fund had dwindled to a mere $19 billion at the end of 2009, down from about $56 billion the year before (see this table for all the numbers). She thought this was pretty significant. Always listen to Lisa: The Wall Street Journal reports that Sen. Chris Dodd has proposed a bill that would let FDIC borrow $500 billion from the Treasury Department.
Nice to know Treasury has the spare billions lying around. If the FDIC’s insurance fund runs out of money, taxpayers are obligated to make up the difference.