Geithner Defends Extension of US Bank Bailout

Associated Press

Transcript

this is a very tough economy and households and businesses still face very significant challenges unemployment of course is very very high commercial real estate losses weigh heavily on many small Banks impairing their ability to extend new loans credit is tight for many small businesses foreclosures driven Now principally by unemployment are very high today I want to outline our strategy to address these challenges going forward and how we're going to wind down and ultimately exit the tarp there are four elements of the strategy first we will terminate and wind down the emergency programs that were put in place at the peak of the crisis that were necessary to break the back of this financial panic in September we shut down the money market guarantee program which earned taxpayers $1.2 billion we've effectively shut down now the capital purchase program under which the majority of tarp investments in Banks were made second we will limit new commitments under this program in 2010 to three areas housing small Banks and credit Market markets for consumers and small businesses for housing we're going to continue to work to mitigate foreclosures for responsible American homeowners as we take the steps necessary to continue to help stabilize the financials the housing market for small businesses we recently launched initiatives to provide Capital to small and Community Banks to commit to increase lending to small businesses and we are reserving additional funds for additional efforts to facilitate small business lending and finally we're going to continue to support the Securities markets that are necessary uh for um for credit flows to Consumers and small businesses third uh Beyond these limited new commitments we will not use remaining Eesa these are tarp funds unless necessary to respond to an immediate and substantial threat to our economy steming from Financial stability a determination that I will only make after Consulting with the president and the chairman of the Federal Reserve board and submitting written notification to Congress fourth we will continue to reduce our financial stake in Banks and manage our down our other Investments we will we will keep the government out of the business decisions of these companies and we will exit from our investments as soon as is practical and return ownership to private hands this strategy requires a limited temporary extension of the authority provided by the Congress under the emergency economic stabilization act it would be irresponsible to do otherwise

Elizabeth Warren on Financial Transparency and TARP

C-SPAN

Transcript

is there a word for your emotions mood watching all of this yeah um I am I think I alternate between Furious and astounded um I really I I am stunned by this and and I'll tell you something else that stuns me a year a little over a year ago the financial institutions let's face it they were in solvent they were they were crashing over the edge they turned to the American taxpayer we did something we had never done before not at that level not with those kinds of numbers and we bailed them out and right now right here on in Washington those same financial institutions are spending huge amounts of lobbying dollars to hit the Senators and the congressmen and the congresswomen every single day because they still want to be the ones who are writing the rules the big financial institutions they want the status quo they don't don't want changes that would cause them to have to alter their business plan they like a business plan in which they keep all the profits and the taxpayers pick up all the losses before our next call the another message since you've taken this job every time I've heard you speak you have been critical of the level of transparency why is it that the a year plus into this that the government can't tell Americans effectively how their money is being spent all right so so first I want to be fair because you have to be fair when we started with secretary Paulson for 14 months ago I couldn't get him to answer the phone um we couldn't get him to appear in front of us at a hearing we couldn't get any explanation of what was going on uh I I really was I felt like somebody on the outside you know pounding on doors that were locked and nobody was listening then we kind of hit a second phase and that was the new Administration came in and they said we want to help but it was hard to find anyone there was a lot of chaos not very many people but a little bit of information began to trickle out we're now in a third phase and there is more information and so there's aite there's a website there are things you can see we have clearer information flows but still not enough information you know the treasury and and the Federal Reserve really seem to believe they can operate behind closed doors and you know maybe they can do that in Good Times no one asked before they have a long history of operating largely in secret but these are not ordinary times when they turn to the American people and say give us $700 billion of your money to spend however we want to spend it um to get that kind of discretion means they have to be willing to be completely open about how they're spending the money Buford South Carolina ear