WASHINGTON – Under heavy pressure to get Americans back to work, President Barack Obama on Monday suggested using a suddenly available pot of money left over from the government's bank bailout to help create more jobs.
Obama, who will address the subject in a speech on Tuesday, has been struggling to trim the nation's painfully high unemployment rate, now at 10 percent, just below a quarter-century high.
He said there may be "selective approaches" for tapping into the money that was to go for propping up seriously ailing financial institutions. The administration and its allies on Capitol Hill would have to get around a provision of the 2008 bailout legislation that requires money that is paid back by banks or left over to be used exclusively for reducing the federal deficit.
With a tough election year coming up, Obama and congressional Democrats want badly to do something about jobs. Turning a highly unpopular financial rescue program, known as the Troubled Asset Relief Program (TARP), into a potentially popular one with new jobs attached has strong political appeal — although Republican critics have depicted such an approach as a backdoor way of putting a second economic stimulus package into force.
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New Hampshire Sen. Judd Gregg, the top Republican on the Senate Budget Committee, said Monday that the law explicitly blocks using the TARP for infrastructure or other nonfinancial industry projects.
"Everybody agreed that this money — as it came back in — was going to go back to reducing the deficit and the debt," said Gregg, who was one of the chief negotiators in writing the law. Gregg said that Democrats are eying "this money as some sort of a kitty, a slush fund to be used by the appropriators around here for the purposes of whatever the next stimulus exercise is going to be."
