Monday, January 12, 2009

Obama Team Wants To Tap TARP for Foreclosures

The Wall Street Journal - WASHINGTON -- The incoming Obama administration, stymied by political opposition to the Bush administration's financial rescue, is negotiating with lawmakers to avoid a messy political fight as it seeks the second half of the $700 billion bailout.The Obama team would like to ask for the money even before President-elect Barack Obama takes office but is concerned lawmakers would reject the request, handing Mr. Obama the sticky task of vetoing Congress as one of his first acts in office.

Members of Mr. Obama's team, including Treasury Secretary-nominee Timothy Geithner, are working to satisfy lawmakers' concerns by proposing using the funds for new purposes, such as preventing foreclosures, and imposing tougher conditions on recipients, according to people familiar with the negotiations.

The political calculations are complicated by the need to navigate around Congress's ire toward the program. Making matters worse is the transition to the new administration, which wants to revamp its predecessor's work.

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