TARP already $78b short of promises
WASHINGTON - The Obama administration will impose tighter conditions on banks receiving money under the $700 billion financial rescue program but for now is not expected to ask Congress for more money in its sweeping overhaul of the bailout, industry and congressional officials said yesterday.
The decision not to request more money would be a relief to lawmakers, given that the administration is unveiling its changes in the midst of a debate over an economic recovery package expected to cost $800 billion.
The program Treasury Secretary Timothy Geithner is set to unveil Monday could cost more than the $350 billion still unspent in the Troubled Asset Relief Program. But officials said the administration would have room to overhaul the program before determining whether to seek more money from Congress.
"Some of the reforms can be paid for without a new appropriation," one official familiar with the plan said.
The industry and congressional officials who spoke did so on condition of anonymity because the details of the program have not been made public.
Key members of Congress had urged the administration not to request more money for the rescue program. Congress approved $700 billion last fall, but since then, many lawmakers have complained that the Bush administration implemented a confused and ad hoc strategy.
"Until they are successful in showing the average American that the money is being used reasonably, there's no point in asking for it, because they won't get it," House Financial Services Committee chairman Barney Frank, a Massachusetts Democrat, said this week.
The administration declined yesterday to provide any specifics of Geithner's new plan. But Treasury said the revamped plan would offer a comprehensive way to stabilize the financial system, while strengthening accountability, oversight, and transparency to protect taxpayer money.