Dodd: Show Me The Bailout Money

Senator Wants Specifics On How Remaining Funds Are Spent; Says Obama Dismayed With How Treasury Has Run Program

(CBS/AP)  President-elect Barack Obama has asked President Bush to formally notify Congress on his behalf of his intent to request the second tranche of funding for the Treasury Department's programs targeting the financial crisis.

White House spokesperson Dana Perino said Obama called Mr. Bush this morning to ask for the action on the TARP fund.

CBS News White House correspondent Peter Maer reports that the president agreed to the request.

But there is asking, and then there is getting.

Senate Banking Committee Chairman Christopher Dodd is setting out the conditions necessary for Congress to approve releasing the second $350 billion of the roughly $700 billion federal rescue plan.

Speaking on CBS' The Early Show, Dodd said that in order to win authorization of such additional spending, the government will have to do a much better job of accounting to the taxpayers for where money already spent has gone.

The Treasury Department has spent about half of the $700 billion that make up the Troubled Assets Relief Program (TARP) approved last Fall; Congress must approve a release of the remaining $350 billion. In addition, President-elect Barack Obama is asking Congress to ready an ADDITIONAL economic stimulus package, of between $750 and $800 billion, as a combination of infrastructure spending, renewable energy projects, and tax relief for businesses and individuals.

Given the criticisms about how the administration has spent TARP funds, with little to no accountability or proof that the money has fulfilled its intended purpose, lawmakers are evincing qualms about approving a release of the remaining $350 billion - and then adding an additional $800 billion on top of that.

Dodd said that Obama had expressed to him his dissatisfaction with how TARP money has been administered so far and that he intends to "re-brand" the program.

"He's not happy with how mismanaged this program has been over the last several weeks," Dodd told Early Show anchor Maggie Rodriguez. "Money going to lenders without assurances [they] are actually going to lend, executive compensation not being limited, as it was promised it would be. So there need to be far more assurances about the accountability standards and how this is all going to work.

"These assurances have to be forthcoming, and if they're not, then we'll have trouble passing this. But if they are, then I believe there's a good chance that this money will be approved."

Dodd said that in addition to higher accountability standards, the bailout's overseers must do more to mitigate foreclosures which, he said, "may be the most important aspect at all.

"We need to put a tourniquet on the 9,000 foreclosures that are occurring every day in this country."

Dodd told Rodriguez that he was encouraged by assurances during a two-hour meeting yesterday with former Treasury Secretary Larry Summers, a key Obama economic adviser, and that "I feel better this morning" about prospects for approval.

He has been told Obama's team will be offering specifics on how the money will be managed. Barring that, Dodd said legislation would be put forward "that will demand those kind of standards if this money is going to go forward."

In response to criticisms about the tax cut portion of Obama's proposed package (which some assign as a political move to win the support of conservatives), Dodd said while he shared those concerns, some tax cuts are what he called "stimulative" and not just giveaways.

"I suppose each one of us might write it a bit differently, but the fact that there are some tax cuts in here that are probably going to be necessary and probably the right step to be taking," Dodd said. "I'd like to see a bit more of the infrastructure than we have in this bill, but that's just one person's opinion. Overall, I think the president-elect has it about right."

Several senators predicted that a vote in Congress on the remaining TARP funds is possible this week, as early as Monday.

Bush And Obama Tag-Team Congress For Remaining Bailout Funds

A vote in Congress on releasing the remaining TARP funds is likely soon, possibly this week, several senators predicted after a briefing yesterday on the Wall Street bailout as well as on Mr. Obama's separate plan intended to spur the economy.

The idea is to make the money available to the new administration shortly after Obama takes office Jan. 20. The unpopular bailout has featured unconditional infusions of money into financial institutions that have done little to account for it.

A request for TARP funds would force a vote within days on whether to block the funding, but the deck is stacked in favor of President Bush and Mr. Obama winning release of the remaining $350 billion.

Congress can pass a resolution disapproving the request, but the White House could veto the resolution; then, just one-third of either chamber would be needed to uphold the veto and win release of the money.

"Larry Summers made a very strong argument for why it's important and critical for the overall recovery," said Sen. John Kerry, D-Mass. "And I think that's an argument that most senators understand."

Summers sought to win over Senate Democrats even as the GOP leader of the House, John Boehner of Ohio, warned that any effort to release the additional money would be a tough sell.

Treasury Secretary Henry Paulson originally promised the money would be used to buy up toxic mortgage-related securities whose falling values have clogged credit markets and brought many financial institutions to the brink of failure.

Senate Majority Leader Harry Reid said that President Bush and Mr. Obama's team were near agreement on submitting notice to Congress about using the remaining $350 billion.

"We're waiting to hear from President Bush and/or President-elect Obama as to what, if anything, they're going to do," said Reid, D-Nev., "and that's occurring as we speak."

But to prevail, Mr. Obama and his team must soothe senators who feel burned by the way the Bush administration has used the TARP.

Selling The Obama Plan

Meanwhile, Mr. Obama and his team are aggressively working to build support for his economic stimulus plan, hoping it will be ready within a few weeks of his taking office.

"Let's not only provide a jumpstart to the economy and immediately create or save three million jobs, but let's also put a down-payment on some of the structural problems we have in our economy," Obama said.

Some Democrats are questioning whether too much is going to tax cuts.

"Marginal tax incentives tend not to work well when the economy is falling away sharply," said Sen. Kent Conrad of North Dakota.

The package features aid to cash-strapped state governments, $500 to $1,000 tax cuts for most workers and working couples, a huge spending package blending old-fashioned public works projects with aid to the poor and unemployed, and a variety of other initiatives.

Advocates for using tax cuts to promote alternative energy won concessions and the Obama team promised to make a $3,000 job creation tax credit - which has attracted considerable criticism - more workable.

Meanwhile, transition officials were resisting efforts to use the economic recovery bill to address the alternative minimum tax, which has affected more and more middle-income families.

CBS News White House correspondent Chip Reid reports that while sources on Capitol Hill say Obama's plan is likely to pass in something close to its current form, economists question whether it will be enough.

"We should use this money as efficiently as possible to create jobs," Dr. Peter Morici, Robert H. Smith School of Business, told CBS News. "That's best accomplished by spending it on roads, bridges, schools, putting people directly back to work, than by rebating taxes to individuals and businesses who may spend the money or who just may put it under their mattresses and save it.

"Once the effects of the stimulus wear off, those jobs will disappear if he doesn't fix what's broken in the economy."

House speaker Nancy Pelosi says lawmakers will have the details ironed out by President's Day in mid-February, or their annual President's Day recess will be cancelled.

[marcy3pu]

Any money that is not accounted for from it''s original purpose and designed should be paid back (out-of-pocket) immediately!!!

Why should we (taxpayers) have to pay for the "good life" of miscreants.

[gophwy71]

""""Dodd, like Frank, played a significant role in tanking this economy.

Next CBS will parade Pelosi out to make it look like she is here to help as well.

We''''d had enough of our government''''s help. There are too many crooks in Washington
Posted by payasyougo at 09:17 PM : Jan 12, 2009""""

You know that''s right....

[payasyougo]

Dodd, like Frank, played a significant role in tanking this economy.

Next CBS will parade Pelosi out to make it look like she is here to help as well.

We''d had enough of our government''s help. There are too many crooks in Washington

[blog_fever2]

I have the one, true, perfect solution to our economy''''s problem. Instead of all these bailouts and throwing money down a bottomless pit, why dont Congress get with the Credit Reporting Agencies and wipe everyone''''s credit clean? Talk about jolt to the economy!!! There would be no need for TARP or any other bailout loans.... Think about it... if this country were to fall today and you had to move to another nation, would your fico score follow you there or affect any of your purchases?

[gophwy71]

""""....whaever type og Karl Rove republican LIAR you really are

please refrain from trying to shift the blame from the

countries problems to the democrats, we all know

that starting with Reagan the country began its

great slide into the second republican depression,

we all know who was at the helm when 9/11 occured,

and we all know what kind of people brought us the

war in Iraq, and a war criminal, a man with no

integrity, to the presidency of the United States.

Evangelical trash like you. We are all praying that

one day you may become a human being.
Posted by pythoncharly at 11:10 AM : Jan 12, 2009""""

What a fruit. You know it was Barney Frank along with Obama and Dodd that suckered all those subprime lenders in...

[gophwy71]

""""1.5 trillion dollars given to 300 million americans would be 5000.00 for every man woman and child in the US. Now that would stir the economy, instead we give it all to 5 or 6 companies who just lined their pockets with it and said the hell with you when asked where the money went. As for bailing out those people who bought homes they could not afford, let them move into an apartment and stop whinning. I didn''''t tell them to buy a home bigger than they needed, that they couldn''''t afford, was overpriced and now can''''t sell. Why should I have to bail them out.
Posted by withad at 11:04 AM : Jan 12, 2009""""

Where would it come from!!?!?!?!?!?!?!?!?!?!

[schoolmarm22]

There should have been strict accountability measures put in place before a single dime was handed out. The bail-out money will not benefit the American taxpayer because the same inept and corrupt CEOs will still be handling the funds.

[lochlan-2009]

How about we go after the peoplewho stole the billions?

Yeah, like that will ever happen. It''s so sad it''s not even funny.

[harbinger09]

That repeal is what put us where we are today. Once again more than enough complicity to go around on both parties.

Posted by renrivers at 01:31 PM : Jan 12, 2009


That, and the short sell bill that was pushed through by Phil Gramm and McCain in 2005.

[harbinger09]

They were the ones that passed the bills that were sent to the president for his signature, they were the ones who allowed the bills to be passed without any oversight built into them, and one of the point men on the senate side was Barrack Obama.

Their is more than enough guilt to go around, and for any Democrat who claims he can think and chew gum at the same time to deny the complicity of the Democrats in all of this, is ludicrous.

Posted by renrivers at 01:18 PM : Jan 12, 2009


The bills you are referring to, which allowed deregulation of S & Ls, deregulation of the banking industry were authored by Phil Gramm (a Republican) and the other bills were also authored by Republicans (though Dems may have also backed some of the bills) these bills were passed in 1999, and 2005. Congress was controlled by the Republicans from 1994-2006. YOu do the math. What the Dems are responsible for, is taking advantage (like the Republicans) of the deregulation and pushing for lax oversight for Fannie and Freddie along with the Republicans--but who actually pushed and authored the bills for Clinton and Bush to sign? EAch time, a Republican controlled Congress. The Dems will be the ones blamed for putting this 750 billion dollar joke on the taxpayers--because they are the only party who never argued or resisted the next set of lies from a man who had consistently lied to them for years (Bush).

[Renegade.Rivers]

Fannie was in the black for more than 50 years until republican tinker that began in 1989. As far as the bailout I''''m against it as well. When it comes to blame I believe the results are in on reaganomics the race to the bottom. I think your still in the denial stage.

Excuse me, but the bill that ultimately repealed the Glass-steagall Act was introduced in the Senate by Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA) in 1999. The bills were passed by a 54-44 vote in the Senate and by a 343-86 vote in the House of Representatives. Nov 4, 1999: After passing both the Senate and House the bill was moved to a conference committee to work out the differences between the Senate and House versions. The final bipartisan bill resolving the differences was passed in the Senate 90-8-1 and in the House: 362-57-15. Without forcing a veto vote, this bipartisan, veto proof legislation was signed into law by President Bill Clinton on November 12, 1999.

That repeal is what put us where we are today. Once again more than enough complicity to go around on both parties.

[Renegade.Rivers]

Taking no other issue but the funds used for the bailout, please point out where this has helped the average American in anyway what so ever. Please point out where the hundreds of billions of dollars that congress and the senate have doled out to banking, big business and all of the other benefactors has made life any better or easier for the little guy on the street.

The truth of the matter is that you can''t, the truth of the matter is none of us can. When one realizes this, it is then almost impossible to not understand these folks and their frustration. Under these circumstances who are they suppose to blame, the man in the moon, or the leaders in Washington who have let us all down.

For anyone with any understanding of what is taking place here, it is plain to see that the Democrats are just as deep in this as the Republicans. They were the ones that passed the bills that were sent to the president for his signature, they were the ones who allowed the bills to be passed without any oversight built into them, and one of the point men on the senate side was Barrack Obama.

Their is more than enough guilt to go around, and for any Democrat who claims he can think and chew gum at the same time to deny the complicity of the Democrats in all of this, is ludicrous.

[harbinger09]

Never forget that business responds to needs and demands of the market--not the other way around. What this means is that businesses create jobs and build in direct relation to the projection of spending and desire by the public. Right now, the desire and projection of CONTINUED spending and desire is flatlined.

That means that there are few places for businesses to spend or build. To put another way--businesses don''t hire or create to get customers--they have more customers than they can handle--requiring more product than they can make--so then they build more businesses and THEN they hire.

Why am I posting this? So maybe--just maybe someone in Congress can get a clue. This is why rebates don''t work--artificial creation of a demand for product (with one time spending) does not give the companies the projection to justify hiring or building. The consumer must have the desire first--then the marketplace RESPONDS. The Congress keeps doing it backwards--thinking, if they give a few dollars for companies--or give it to us to give to companies--the companies will build plants and hire people. For what? For the rest of the year, when there are no rebates and no guarantee of a return or consumer demand?

First you get those who still have businesses stabilized...give the public enough to continue to spend for at least a year--then you get business responding--the way Bush and Obama are doing it--it will NEVER work. Because it makes no sense.

[harbinger09]

"Consumerism is the engine driving the American economy"

People without jobs do not spend much money.

People who are laid off, do not spend much money.

People who have had to take lesser paying jobs because their company moved overseas do not have much money to spend.

People who must compete with illegals who take jobs for less and employers get to NOT deduct for Social Security, or OSHA or workers comp, so employers would rather hire the illegals than them and the illegals send most of their money back home--do not spend much money and don''t get hired by bosses preferring illegal labor

On top of this scenario--our stupid gov expect us to keep spending....

Now enter a war based on lies costing 300 to 500 million dollars a DAY

Continual borrowing from China and the ME to offset the short fall due to the war and consumers not making enough to spend enough....

And now we have a problem? The only ones who did not see all of this coming were those too ignorant or too greedy to do anything except keep playing. The dots were always there--the housing bubble? It just brought America''s ponzi game to a crashing end, just like it brought Maddoff''s. The trick was to keep us spending until at least Bush got out--he couldn''t. We couldn''t. And Congress still has no clue what happened. Anyone who wants is welcome to send this post to Congress. If you cut your own legs off--then don''t be surprised when you no longer have a leg to stand on.

[harbinger09]

Bush: "Spend, spend, spend--it is your patriotic duty--consumerism is the engine of our economy" So it is with every Ponzi scheme--the money only continues as more people get into the game. Then they outsource the jobs, higher illegals--the first gambit replaces the outsourced jobs with lesser paying "service" jobs and the cheap price of illegals depresses wages further?

Don''t have much money? Here''s a rebate check--"now spend--spend--spend

What''s that? Service jobs require mfg or primary creation jobs to stay in business? So where are all those jobs? China? Well, who outsourced them? SAy...here''s another rebate--now please ''spend --spend--spend.

They gutted America, then they hamstring the workers, then they put shills in the game, then they told us that the only way to win the race was to run our azzes off--with what? They already took our legs--then they kept printing and borrowing for that stupid war....and inflation went through the roof--then somebody got the idea that if they gave us a few dollars during inflation--that spending would save the economy. That is like saying--people can earn a living by spending--with no thought to who the fvck should keep on working. "Consumerism is our greatest product" People don''t make much money spending it--dummies. "Spend--spend--spend" Now Obama: SAy..."let''s give them all 500.00....again...That''ll work" IDJIT

[harbinger09]

antoniof123: Tough to blame Republicans, when it has Edward1975 at 12:12 PM : Jan 12, 2009


The problems with our economy span over a decade, Republicans controlled Congress from 1994-2006. The Dems have had control for only 2 years. Get it right--the huge spending spree was done by a Republican controlled Congress kowtowing to their power hungry GOP President. On a good note, the savings and balanced budget under Clinton was also done by a Republican controlled Congress.

But certain facts remain--from 2001-2006 more money was added to the deficit in those 5 years than was added to our deficit for 200 years combined. that is a fact. That was with a Republican President, with a REpublican Congress and a REpublican weighted Supreme Court. Doesn''t get any uglier and clearer than this.

You may want to blame the Democrats--I do too. The fact is--the Republicans went on a crime spree and the Dems were in the car, going along for the ride. There are no halo''s here. Even for deregulation--the bills were authored by Republicans but many Dems also used the deregs to their advantage and gained favor. money and power from it too--just like the REpublicans. So the real story--both are guilty--but due to the depth of the problems--one group is more guilty than others--take solace from the fact that Dems are too stupid and timid to do the dirt Cons do--Cons were the mastermind to the greatest public ponzi scheme in history.

[harbinger09]

I believe you are refering to pork. Pork represents projects within a politicians own district. It also represents jobs for that community as well. rightbehind at 12:00 PM : Jan 12, 2009


Look at each war appropriations bill. Each contains at least 15 to 35 billion in additional spending--McCain''s number is off. It is more than 100 billion and to put that in perspective--we just gave the automakers 13.5 billion and whined about doing that. As for pork barrel spending--a lot of the projects are bs. Take the one for 300K to study turtles crossing the highway, or the one HRC tried to get to build a Woodstock Museum. IN hard economic times, we do not need fake projects that put more money in corrupt hands than they ever helped the public. EAch year for over 27 years, Alaskans have received more money per capita than any other state. The avg amount ranged from 265 million to over 420 million per year. There are about 650K people in AK. After all that time, enough money has poured into Alaska to have each person making or gaining a min of 30K per year. But most Alaskans are below poverty level, with high drug rate, the highests rape and domestic abuse rate--where is the money? IN the hands of a few--who funnel projects to their friends and themselves and get rich--that''s where.

[edward1975-2009]

antoniof123: Tough to blame Republicans, when it has been Democrats in control of Congress. Pelosi and crew have shown the backbone of a jellyfish, they have postured then folded to a lame-duck President at every turn. And will continue with Obama at the helm. If people truly wished to find blame for these bailout miscues, look no further than Congress, for it is they who hold the purse strings.

[harbinger09]

"Once the effects of the stimulus wear off, those jobs will disappear if he doesn''t fix what''s broken in the economy."


Who in their right mind would expand their business or hire a bunch of people based on a one time hand out from the gov? After the money is spent, everyone would be right back where they started with NO MONEY. So they would not be buying anything--which means no business should be expanding or hiring--to retain employees not needed, to sell goods that no one will buy.

Fix the economy? You can''t fix STUPID. And thus far, the Congress, the President and even Obama have NOT a clue as to what they are doing--just throw money at it--it''ll work...Reminds me of Butttt Head throwing Beavis out of a fast moving car, claiming he would not get hurt: "Just keep moving your legs real fast Beavis, when you hit the ground...it''ll work"


Just keep throwing money at it--give it to jet flying auto execs and party throwing banks--and give each middle class family about 500.00--It''ll work. Yeah right--fvcking, fvcking, fvcking, idjits.

[antoniof123]

More neocon dribble they alwasy try to blame someone else. Okay neocons here is the answer 2 to 1 view this mess as being caused by the Republicans that means that 2 to 1 are wrong. I don''t think so, it is the minority that is wrong and if you don''t like it well.

I don''t care.