Dodd Says Obama to ‘Re-Brand’ TARP If New Funds Are Released

[babylonsister]

Source: Bloomberg

Dodd Says Obama to ‘Re-Brand’ TARP If New Funds Are Released

By Ryan J. Donmoyer


Jan. 11 (Bloomberg) -- Senators said Larry Summers, the top economic adviser to President-elect Barack Obama, signaled the incoming administration will back new restrictions on use of the remaining $350 billion of financial-rescue funds that may be sought this week.

Senate Banking Committee Chairman Christopher Dodd, a Connecticut Democrat, said Summers assured senators today that the administration will insist on tougher “accountability standards.” Lawmakers have accused banks that received the first half of the $700 billion program of squandering the money on acquisitions and employee bonuses without lending the money to consumers.

“The Obama administration wants to re-brand this process,” Dodd told reporters on Capitol Hill. “They realize it has been terribly mismanaged.”

Dodd said a request for the funds may come from the outgoing Bush administration as early as tomorrow to leave time for a vote this week before Obama is inaugurated Jan. 20. “It has to be within a day or so,” he said.


Read more: http://www.bloomberg.com/apps/news?pid=20601087&sid=amZuE9xEtNOU&refer=home

[notesdev]

1. Oh that'll work wonders I'm sure

The problem is the concept of handing out free money to failed institutions to bail out crooks, not the branding. Surely there is something better to do with $350B than toss it down a rat hole.

[babylonsister]

3. That's not their concept...

Big changes to Obama stimulus plan
By MANU RAJU | 1/11/09 8:01 PM EST


President-elect Barack Obama tried Sunday to shore up support in Congress for his ambitious economic policies, with his top advisers offering concessions on his economic-stimulus proposal and preparing to detail conditions for how the incoming administration will spend the second half of the $700 billion financial rescue package.

Emerging from a two-hour meeting in the Capitol with Obama advisers Lawrence Summers and Jason Furman, Senate Democrats praised the President-elect's team for agreeing to make changes to its stimulus proposal based off of concerns senators raised last week at a meeting with the president-elect’s senior aides.

The Obama team told about 35 Senate Democrats gathered at Sunday’s meeting that it would grow the size of an energy-tax incentive package and modify proposed tax credits for individuals and for businesses that hire new employees, according to meeting attendees. Also, with lawmakers raising concerns that the first half of the $700 billion of the financial rescue law was badly mismanaged, Obama’s team signaled it would lay out precisely how it would spend the second half of that package, which Congress is expected to consider as soon as this week.

“It’s very clear they’ve listened, they’ve heard and that they’re moving to respond,” said Sen. Kent Conrad, chairman of the Budget Committee, who questioned previously whether the tax credits in the stimulus package were enough to encourage new jobs. “It was very, very healthy. They’re not defensive, not arguing back, they’re listening, they’re attempting to hear and they’re responding.”

more...

http://www.politico.com/news/stories/0109/17335.html

[notesdev]

5. An accounting is necessary

of every dollar spent of the first $350B, before a single cent more is thrown their way.

The absolute refusal by both the Treasury and the Fed to account for a dime is not something that lends credibility to a call for additional money to be allocated to them.

Let's see what happened to the last $350B. Only then does it make any sense to talk about more.

[babylonsister]

6. Fine, I agree. But immediately, if this money is to be used immediately, it

needs to be accounted for also. Crisis, remember?

[notesdev]

8. A crisis does not mean panic

Just because we're in a crisis, doesn't mean anything that may be done in the name of solving the crisis is effective. If anything, it's a reason to be more careful and insist on accountability. This should be even more obvious after the first $350B got us nothing.

Reacting to a crisis by giving money to the very same people who caused the crisis is insane!

[babylonsister]

9. Who's panicking? I think this is being done pretty well, given the

circumstances. Lots of brains are now in on it.

[stillcool]

11. there is no accounting with..

the present administration...for anything.

[Neshanic]

2. Dodd Bucks! Cristopher Cash! Demo Dough! Thank God it passed notes!

Where is Larry Tate when we need him?

[rwheeler31]

4. This is the dumbest thing you could do. Have you no patience.

[babylonsister]

7. Patience? Are you unemployed? nt

[w4rma]

10. If this isn't done right there is no second chance. Patience! (nt)

[babylonsister]

12. Gotcha. But it seems every effort is being taken to provide

accountability, by everyone. What more do you want? This economy is close to tanking, and it's not getting better.

Should we wait for a commission to examine options? That could take a few years.

[w4rma]

13. Commissions are usually appointed as a stall tactic, rather than an attempt at actually dealing with

an issue. At least that's been my observation.

[babylonsister]

16. Mine, too, but it also keeps the issue alive. nt

[Telly Savalas]

15. I'll believe that every effort is being taken to provide accountability when I see the details.

There was vague talk of accountability when TARP was first established, but we've seen virtually none of it realized.

It's been over three months since the EESA was passed, so all the policy wonks should have had more than enough time to come up with very detailed proposals on how to guarantee a maximum level of transparency and accountability. Congress isn't doing its job if it hands over the money without seeing the specifics of these promises and provisions on how we can be sure these promises will be met.

Moreover, will we have assurances that this money is only going towards those who really need it? Below is a list of banks who have participated in the Capital Purchase Program (part of TARP):

http://www.ustreas.gov/initiatives/eesa/docs/001-06-09-CPP-Report.pdf

Bank of America got $15 billion. Were they really in trouble? Does the government need to intervene on their behalf?

Wells Fargo got $25 billion -- if their balance sheet was so weak, then how did they manage to buy Wachovia?

$3.5 billion for Capital One? Shit, they could probably come up with that themselves by cutting their advertising budget by 2%.

I'm all for the federal government stepping in to prevent the collapse of our financial system, but it's not really clear that the TARP money is being used for this purpose.

[lonestarnot]

14. I can wait a fucking 8 days more.

[HopeHoops]

17. Just slap "NEW AND IMPROVED" in front - NAITARP - As SEEN on TV!

[No Elephants]

18. Give Bushco a blank check, almost literally, but put the screws to Obama. Perfect. . [sarcasm].