How Do You Solve a Problem Like TARP?

The Obama Administration is giving serious thought to the best use of the remaining funds that are part of the Troubled Asset Relief Program (TARP) financial bailout. The President – under pressure to bring down the deficit that has grown as the government seeks to reverse the economic crisis — is considering using a significant amount of the leftover funds to reduce the national debt.The government is considering how to spend $139 billion in remaining TARP funds.

Approximately $139 billion of the $700 billion financial bailout program passed last year remains unspent and available to the Treasury Department.  Financial institutions have returned approximately $71 billion in TARP funds to the government and paid an additional $10 billion in interest and dividends to the Treasury Department.  The struggling economy and high unemployment rates are the impetus for paying down nearly $200 billion of the $12 trillion national debt.

Some Democrats in Congress think that unspent TARP funds should be used as an antidote to rising unemployment.  According to Representative John B. Larson (D-CT), chairman of the House Democratic Caucus, lawmakers could send a strong message about their priorities by using TARP funds to pay for road and bridge projects and other efforts that will create jobs.  “We want to look at how Wall Street can refund Main Street,” Larson said, noting that he and other senior House Democrats are considering a tax on financial transactions.  One possible use of unspent TARP funds could be payouts to small business programs to jump start job growth.

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One Response to “How Do You Solve a Problem Like TARP?”

  1. mizner park says:

    The stock market rebounded and generated these large bonuses because of the government bailout of Wall Street after the derivatives market caused the financial meltdown. They got these bailouts because of insiders like Larry Summers and Timothy Geithner among others who were part of the team that fought tooth and nail to prevent regulation of that market. They protected the obscene profits these financial institutions earned prior to the collapse and pushed to bail them out so they could continue to earn obscene money. The Free Market advocates said that the market would self regulate and it did when the meltdown occurred. Then they took care of their own with the bailout and millions of ordinary Americans are paying the price and will do so for years to come. Of course, Obama has these men in key economic positions in government today while simultaneously paying lip service to the effect that he is going to take steps to avoid another similar crisis. I find it hard to believe that anything will actually occur to substantively change the policies that these men help put in place. I hope their new Lamborghini’s, second and third homes and lavish vacations help to console their conscience as they drive by the millions of foreclosed homes, bread lines and homeless. The next crisis is just around the corner and another bailout may not be there to save them and us.

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