Tuesday, January 13, 2009

Obama's $350 Billion "Trust Me"

The President-Elect was on Capitol Hill today, urging Congress to give him the second half of the financial rescue bill they passed in October:

"I felt that it would be irresponsible for me, with the first $350 billion already spent, to enter into the administration without any potential ammunition, should there be some sort of emergency or weakening of the financial systems."

Before addressing lawmakers and reporters, Obama had his economic team send Congress a letter outlining priorities for spending the money--using "our full arsenal of tools" to get credit flowing; strengthening oversight of the TARP and other rescue programs; deploying "smart, aggressive policies" to reduce foreclosures; toughening conditions for recipients of bailout money; and attracting private capital to limit new bailout outlays.

To the untrained ear, it sounds like a huge "Trust me," but Chairman Barney Frank of the House Financial Services Committee is ready to buy it: "We should not allow our disappointment at the Bush administration's poor handling of the TARP program to prevent the Obama administration from using the funds in more appropriate ways."

All this would be unnerving enough without the disclosure today that Treasury Secretary designee Timothy Geithner will have to explain at his confirmation hearing failure to pay tens of thousands of dollars in federal taxes (after underpayments were detected, he turned over $43,000 in back taxes and interest) and to answer questions about the immigration status of a former household employee.

This reminder of Zoe Baird, the Attorney General choice Bill Clinton lost in 1993, is not reassuring in today's shaky atmosphere.


The Littlest Gator said...

wow, I like your blog a lot.

but this time I totally disagree. We gave paulson the 1st half with virtually NO oversight. Obama is giving more of an idea how he would use the money than we got for any of the first 350 and he does need to at least be able to respond to the crisis as he will certainly be judged in his first 100 days. We need to give him the tools to work with. If you want to stretch it out a bit. Then at least provide the money in segments. Maybe the first 110 to start.

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