Bush Agrees To Obama Bailout Request

Obama Seeks Final $350 Bailout Funds Available For His First Days In Office

(CBS/AP)  Acting at Barack Obama's behest, President George W. Bush on Monday asked Congress for the final $350 billion in the financial bailout fund, effectively ceding economic reins to the president-elect in an extraordinary display of transition teamwork.

Obama also sharply criticized Bush's handling of the money and promised radical changes.

Bush's move sets the stage for Obama to get swift access to the $350 billion and the opportunity to overhaul the much-criticized rescue package after taking office next Tuesday. Obama said that it would be "irresponsible ... to enter into the administration without any potential ammunition should there be some sort of emergency or weakening of the financial system."

Congress, where the use of the money has met stiff bipartisan skepticism, has 15 days to vote to reject the request. Senate Majority Leader Harry Reid, D-Nev., was considering holding a vote on a resolution of disapproval as early as Thursday in hopes it would be defeated, thus making the funds available about a week after Obama inherits one of the worst financial crises in U.S. history.

"It is clear that the financial system, although improved from where it was in September, is still frail," Obama said, a few hours after seeking Bush's help in requesting the money.

Speaking on CBS' The Early Show, Sen. Chris Dodd set out the conditions necessary for Congress to approve spending the second half of the $700 billion federal rescue plan, saying 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.

Dodd said that Mr. 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 CBS' The Early Show. "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.

Dodd said he was encouraged by assurances during a two-hour meeting yesterday with Summers and feels "better this morning" about prospects for approval.

If Congress goes along, Obama would have a huge cache of bailout money at his disposal - and much more to come in the approximately $800 billion economic stimulus bill that Democratic congressional leaders promise to finish by mid-February. Congress also is racing to have ready for Obama a $35 billion health insurance program for children.

Obama acted quickly, sending prompt reassurances to congressional leaders that the money would aim to help free credit for small businesses and consumers and reduce the rising number of foreclosures. Separately, Larry Summers, Obama's choice for National Economic Council director, said the new president intends to also impose tougher restrictions and oversight on how the money is spent.

"Many of us have been disappointed with the absence of clarity, the lack of transparency, the failure to track how the money's been spent and the failure to take bold action," Obama said.

In a letter to congressional leaders, Summers said an Obama administration would "launch sweeping efforts to address the foreclosure crisis" and, in a bow to Republican critics of the plan, said it would seek to replace the government money with "private investments as quickly as possible."

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Click here to read Larry Summers' letter to Congressional leaders.

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Obama and the Bush administration had been negotiating for days on how and when to seek access to the second half of the Troubled Asset Relief Program. His economic team also has been working with congressional Democrats, in particular House Financial Services Chairman Barney Frank, D-Mass.

Frank has introduced legislation that would require at least $40 billion of the money be used to reduce the number of foreclosures. His legislation also would set new conditions on institutions that receive the money, including limits on executive compensation. Frank's committee is holding a hearing on the program on Tuesday and the House is scheduled to vote on his legislation this week.

"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," Frank said in a statement Monday.

But other lawmakers were hardly supportive.

House Republican leader John Boehner of Ohio warned that it would be irresponsible to spend the money without a plan showing how the government would eventually extricate itself from underwriting the financial markets.

"I remain disappointed about the way TARP has been managed and how its resources have been spent over the last several months," he said. He added: "I will oppose the release of these taxpayer funds when the matter is considered on the House floor."

Even Democratic allies were wary.

Sen. Barbara Boxer, D-Calif., said Obama called her Monday morning to seek her support for the additional money.

"I told him that for me to vote for this a second time, I'm very, very hesitant to do it," she said. "I need to make sure that there's going to be transparency, that there's going to be help for housing."

At his news conference, Bush defended his handling of the first $350 billion.

"I readily concede I chucked aside some of my free market principles when I was told by chief economic advisers that the situation we were facing could be worse than the Great Depression," the president said.

But he credited the program so far with improving the credit environment, saying that "lending is just beginning to pick up."

Congress approved the program in October, authorizing $700 billion to assist the financial industry.

The current administration has already committed the first $350 billion, using it to inject capital into banks with few strings attached and to bail out ailing financial companies considered too big to fail without further damage to the economy. A small portion of the money has gone to automakers General Motors Corp., and Chrysler LLC.

[a_nother2002]

England is even a country,

England is just British island territory and property of the private British East India Company Empire.

Posted by whitemale08 at 02:48 PM : Jan 12, 2009

England is not a nation, it''''s British island territory...google it.

You better learn the real history of these people and know what they intend to do stay in power now that their financial empire has collapsed.

Posted by whitemale08 at 03:00 PM : Jan 12, 2009

You really have no clue about life outside your trailer do you? Dates facts figures. None of which you have. We have had a parliment long before your country even bothered to fight to get yours.

[girlmiami]

every single family should have gotten 5k or 10k,,,it would been in better use. its very sad. for people that are lay off and losing their homes. no one cares for the working class.
what a joke this bail out

[a_nother2002]

WRONG! You can''''''''t even be a member of their ... parliaments unless you''''''''re a member of the ... peeerage WHO ELECT EACH OTHER!

Posted by TexHillGirl at 02:28 PM : Jan 12, 2009
You''''re wrong,

Tony Blair called upon Elizabeth to use some colonial law that was purposely was kept in place to remove the people of Gaicos islands.

The Parliament really has no power, they just put on this charade of ''''democracy'''' when England is not even a country but part of the British East India Company Empire.

The ''''money-changers'''' or (oligarchies) long ago made a pact with the so-called monarchies to rule the world together by ''''finance'''' or ''''usury''''.

They''''re just a gaggle of inbred control freaks and blood sucking parasites.


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Posted by whitemale08 at 02:41 PM : Jan 12, 2009

Ok as a resident of the UK I will tell you both you have NO IDEA what your talking about. The people elect the Government, who make laws, vote on them and pass them. If you want to know how England works ASK AN ENGLISHMAN NOT SOME NON THINKING BIGOT.

[a_nother2002]

Socialism deals with moving around weath to essentially create a middle class (oh the horror)

Communism deals with the gov. taking over properties

Fascism uses terror to assume a central form of control.

Man this Pretty much sums up the GOP for the past couple of years to the T.

Posted by melchg at 12:22 PM : Jan 12, 2009

melch, are you reading out of textbook? Name one country where socialism, communism, and fascism haven''''t completely devastated the people and left the people in charge as rich hogs.

Posted by Eliphord at 12:25 PM : Jan 12, 2009

Dude isn''t this happening to America now? Regular people out of work out of homes and broke, The top few richer now then they could ever of hoped.
You just proved his point. congratulations sucker.

[flsunjnky]

Ya know MS1-1-11, get off here and go and take care of your problem!

[ms1-1-11]

... a soliloquy ... a monologue...what is the difference...?

BOY GEORGE in deep in thought...

I summon thee oh Dark Lord...come forth

Give me time
To realise my crime

Do you really want to hurt me
Do you really want to
Make me cry

Words are few
I have spoken
I could waste a thousand years
Wrapped in sorrow

my Theatre of Tragedy''s
what is the question
oceans of questions
what is the answer

Perchance thou shalt come forth from a deep sleep
that seemed to beckon Squalor and tragedy ...
8 years of a weak ,cowardly ,failed administration
stupidity, ignorance, incompetance ...

[stloubill]

"There''s an old saying in Tennessee %u2014 I know it''s in Texas, probably in Tennessee %u2014 that says, fool me once, shame on %u2014 shame on you. Fool me %u2014 you can''t get fooled again."
George W. Bush %u2014 Nashville, Tenn., Sept. 17, 2002

[stinginrich]

At his news conference, Bush defended his handling of the first $350 billion.

"I readily concede I chucked aside some of my free market principles when I was told by chief economic advisers that the situation we were facing could be worse than the Great Depression," the president said.

But he credited the program so far with improving the credit environment, saying that "lending is just beginning to pick up."


Uuuuh, no it''s not, Shrub.....

[tripster101]

Right misha128, at least Obama has a law degree, and is surrounded by smart people. I don''t think he would make such an indefensible mistake.

[misha128-2009]

Democrats are more compliant with reporting requirements and support of the congressional oversight than Republicans in general. On at least two occasions the Bush Administration has been rebuked by the courts for inappropriate extensions of executive privilege and common items from prior administrations like the White House Visitor''s list. So yes compared to the Bush Standards and even the Reagan standards, I expect the Obama administration to adhere to reporting requirements from Congress as well as supporting the Congressional Oversight Process as did many Clinton staffers on numerous occasions prior to Bush''s paranoid administration. Strangely the Clinton Staffers had considerably superior recall to Bush staffers -- notoriously the Ex AG Alberto Gonzales -- (or was that Sergeant Shultz? -- I know (recall/remember) nothing, nothing)

[b4ucmyi]

Every penny of the bailout money will "disappear" into the pockets of the rich. After that, they''ll come back for another trillion. All without an accounting or a shot being fired. How stupid ARE the American people?

[misha128-2009]

Wink, wink, wink, wink...

Posted by TexHillGirl at 09:35 PM : Jan 12, 2009

Trying to pick up a john? Just tell them about your low low rates.

Posted by Bushtarded at 09:38 PM : Jan 12, 2009

I thought it was a Sarah Palin imitation from the VP debate -- super creepy.

[misha128-2009]

Posted by TexHillGirl at 09:29 PM : Jan 12, 2009

Take these comments for what they-re worth as this user is the resident Queen of Fabrication.

[misha128-2009]

Sounds like a back door approach to stop the process; I believe the past proceedings should be reviewed by new IG''''''''s and if necessary the DOJ to determine what happened on Bush''''''''s watch. The need it too time critical to hold the process for an accounting of what has already been classified by an Inspector General (IG) as a proverbial rat''''''''s nest.


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Posted by misha128 at 07:38 PM : Jan 12, 2009

So, in other words, what has already been flushed down the rat hole, is OK, right!


The next $350Billion needs a babysitter! Nao eh!

Hello!

Posted by roscoe2400 at 07:49 PM : Jan 12, 2009

Actually the first set needed a baby sitter and what it got was another Paul Bremmer surrogate. Remember the Iraqi profisional governor appointed by Bush that lost 8 billion dollars in cash (20''s I believe) he had flown to Baghdad shortly after the invasion ended. The Bush administration has been one of the biggest disasters in history in terms of repeated colossal and expensive management failures across a significant number of Departments.

[trillion1]

Hope someone gets to read this before CBS censors it. The idiot in the WH wants the major networks to carry his farewell address on thursday. Most American''s and the world just want him gone. He had 8 years and NOTHING he says now can change the fiasco he has created.

[roscoe2400-2009]

Sounds like a back door approach to stop the process; I believe the past proceedings should be reviewed by new IG''''s and if necessary the DOJ to determine what happened on Bush''''s watch. The need it too time critical to hold the process for an accounting of what has already been classified by an Inspector General (IG) as a proverbial rat''''s nest.


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Posted by misha128 at 07:38 PM : Jan 12, 2009

So, in other words, what has already been flushed down the rat hole, is OK, right!


The next $350Billion needs a babysitter! Nao eh!

Hello!

[misha128-2009]

I think this money should stay put until a complete accounting of the first payout is presented to the American people by a foreign internal auditing firm. No! Emphatically no! should this investigation be run by the most corrupt and getting worse Congress in Global History. The results should be given to the American people and not Congress. No more money until the first payout is accounted for, every penny!

Posted by clancy49 at 07:34 PM : Jan 12, 2009

Sounds like a back door approach to stop the process; I believe the past proceedings should be reviewed by new IG''s and if necessary the DOJ to determine what happened on Bush''s watch. The need it too time critical to hold the process for an accounting of what has already been classified by an Inspector General (IG) as a proverbial rat''s nest.

[clancy49]

I think this money should stay put until a complete accounting of the first payout is presented to the American people by a foreign internal auditing firm. No! Emphatically no! should this investigation be run by the most corrupt and getting worse Congress in Global History. The results should be given to the American people and not Congress. No more money until the first payout is accounted for, every penny!

[misha128-2009]

They''''ll have to renegotiate home loans as right now most Americans are upside down on their Loan/Value. You get mass bailing by homeowners on properties they refuse to throw money down a hole on, and the foreclosures go through the roof. It will only benefit banks to get these loans down to present uninflated prices so people will stay put and make their payments on time.

Posted by stinginrich at 07:28 PM : Jan 12, 2009

The original plan I heard indicated that a homeowner that was upside down and got a break would have to pay back some (undetermined or unknown by me) portion of the writedown of value If there was a profit over the revised value at the time of a future sale of the home.

[stinginrich]

***************
I sure hope so. If so it is about time. Something has to be done and soon or we will be in a depression instead of a recession. This should NEVER have been allowed to get this bad.


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Posted by DebinOK1 at 07:21 PM : Jan 12, 2009
+ report abuse

They''ll have to renegotiate home loans as right now most Americans are upside down on their Loan/Value. You get mass bailing by homeowners on properties they refuse to throw money down a hole on, and the foreclosures go through the roof. It will only benefit banks to get these loans down to present uninflated prices so people will stay put and make their payments on time.