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Geithner Preparing Overhaul Of Bailout

Posted By admin On January 9, 2009 @ 11:42 am In Money Watch | Comments Disabled

David Cho
Washington Post [1]
Friday, Jan 9, 2008

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.

(Article continues below)

Geithner Preparing Overhaul Of Bailout 161008pptv3 [2]

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.

Full article here [1]


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URLs in this post:

[1] Washington Post: http://www.washingtonpost.com/wp-dyn/content/article/2009/01/08/AR2009010804109.html?hpid=topnews

[2] Image: http://www.prisonplanet.tv/subscribe.html

[3] Geithner: ‘We Saved the Economy, But We Kind of Lost the Public Doing It’ | Me: We Can Save the Economy, But Only If We Kind of Lose Geithner: http://www.prisonplanet.com/geithner-we-saved-the-economy-but-we-kind-of-lost-the-public-doing-it-me-we-can-save-the-economy-but-only-if-we-kind-of-lose-geithner.html

[4] Geithner Defends Plan to Give Fed Stepped-Up Powers in Overhaul: http://www.prisonplanet.com/geithner-defends-plan-to-give-fed-stepped-up-powers-in-overhaul.html

[5] Geithner Said to Be Seeking TARP Extension Until Next October: http://www.prisonplanet.com/geithner-said-to-be-seeking-tarp-extension-until-next-october.html

[6] KUDLOW: My Source Says Tim Geithner Is Leading The Search For The Next Fed Chair: http://www.prisonplanet.com/kudlow-my-source-says-tim-geithner-is-leading-the-search-for-the-next-fed-chair.html

[7] Geithner Said to Tell Bernanke Fed Gains Most in Rules Overhaul: http://www.prisonplanet.com/geithner-said-to-tell-bernanke-fed-gains-most-in-rules-overhaul.html

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