Washington, DC – Today, the U.S. Senate rejected a resolution disapproving of the release of $350 billion for the Trouble Asset Relief Program (TARP). The vote clears the way for the funds to be released to the incoming Obama Administration.
Oregon Senator Jeff Merkley voted to release the TARP funds. Merkley issued the following statement:
“Last fall, I opposed the $700 billion bailout of financial service firms because I felt the legislation was fundamentally flawed. It did not help homeowners, or get to the roots of the crisis; it required virtually no limits on executive compensation and did not ensure that those who created this crisis weren’t cashing in at taxpayer expense; and it did not include sufficient safeguards or oversight of taxpayer money.
“These concerns were borne out through the Bush Administration’s actions and the actions of the financial firms over the subsequent months. We saw almost no oversight or transparency; we saw taxpayer money being used to fund mergers and takeovers, not unfreeze the credit markets; and we saw no effective effort to directly assist homeowners facing foreclosure.
“During numerous discussions this week with the Senate leadership, Larry Summers, Rahm Emanuel and President-Elect Obama, I advocated fiercely for much stronger and more effective measures to assist homeowners. I believe they heard my message and have committed to revamping the program.
“Specifically, they have now pledged to devote a significant portion of this package to direct foreclosure mitigation – at least $50 billion and up to $100 billion. This aid is desperately needed by the 2 million Americans who face foreclosure this year – including nearly 26,000 Oregonians. Furthermore, firms taking TARP funds will now be required to restructure the mortgages they hold to avoid foreclosure. The incoming Administration is also committed to reforming our bankruptcy laws to allow judges to alter the terms of home mortgages, just as they already do with other types of loans.
“In addition, the incoming Obama Administration has addressed many of my other concerns, for example, pledging new practices to guarantee transparency and oversight of the program and blocking aid for firms that do not limit executive compensation.
“This vote was not an easy decision for me because the structure of the resolution does not provide an opportunity to amend specific provisions of the TARP program. However, after receiving the personal assurances that the steps I outlined above would be taken, I have chosen to support the release of these funds to help homeowners and unfreeze the credit markets.
“I have long said that we need a government that works for working Americans and puts Main Street ahead of Wall Street. I now believe the TARP funds will be used more wisely to stabilize our markets, and more importantly, to keep families in their homes.”