Geithner Preparing Overhaul Of Bailout

[Pirate Smile]

Source: Washington Post

Geithner Preparing Overhaul Of Bailout
Obama Team Broadens Scope to Secure Final $350 Billion for Rescue

By David Cho
Washington Post Staff Writer
Friday, January 9, 2009; Page A01

Confronted with intense skepticism on Capitol Hill over the $700 billion financial rescue program, Treasury Secretary nominee Timothy F. Geithner and President-elect Barack Obama's economic team are urgently overhauling the embattled initiative and broadening its scope well beyond Wall Street, sources familiar with the discussions said.

Geithner has been working night and day on the eighth floor of the transition team office in downtown Washington with Lawrence H. Summers and other senior economic advisers to hash out a new approach that would expand the program's aid to municipalities, small businesses, homeowners and other consumers. With lawmakers stewing over how Bush administration officials spent the first $350 billion, Geithner has little chance of winning congressional approval for the second half without retooling the program, the sources added.

That challenge is underscored by a report from a congressional oversight panel scheduled to be released today that hammers the outgoing Treasury Department for its handling of the financial rescue, including "what appear to be significant gaps in Treasury's monitoring of the use of taxpayer money." The report, moreover, faults the Treasury for failing to properly measure the success of the program or establish an overall strategy and skewers the department for not using any of the funds on foreclosure relief as Congress had directed.

Much of the work by Obama's team has focused on establishing principles that would clearly define the program's course and the conditions of government aid to financial firms.
With Geithner leading the discussions along with Summers, who will head the National Economic Council in the White House, the group is devising plans that would use rescue funds to help homeowners avoid foreclosure and unclog the credit markets that finance loans to consumers, small businesses and municipalities. The team is also planning to have the government take more stakes in financial firms, but companies receiving federal aid would have to submit to greater restrictions on executive compensation than were imposed by the Bush administration.



Read more: http://www.washingtonpost.com/wp-dyn/content/article/2009/01/08/AR2009010804109.html?hpid=topnews

[rockymountaindem]

1. That's encouraging n/t

[backscatter712]

2. THERE IS A GOD!!!

That's $350 beeeeelion dollars - add Obama's stimulus package on top of that, and we've got a full triiiiilion or so to work with to jump-start the economy. That will be helpful.

[Tandalayo_Scheisskopf]

3. $350 Billion.

Think of all the redecorating of mansions and vacation homes that is going to pay for!

For all that money, can't we have at least a few well-tarred heads on Pike Poles? Is that asking too much? Really?

[SlowDownFast]

4. Sweet. More bonuses, spa treatments and mansion redecorations

for bankster CEO's.

Just what the doctor ordered.

[OKDem08]

5. How much more debt can this country acquire

before we declare bankruptcy?

[Golden Raisin]

6. Uh...the horses, cows, chickens

and ducks have already left the barn and the barn burned down. First step in overhaul: fire Paulson and Kashkari.

[Demeter]

8. Then Prosecute Them, Along with other BushCo Operatives

[Kolesar]

7. They should stimulate the banks that had responsible mortgage polices

...And help them grow to become the "new" banking system in America. Let all those unregulated banks flounder and die. I don't know how this would work, but if what we need is a "credit system" in America, why don't we just build a new one?