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View Diary: Billions slated for homeowner relief may go to deficit instead (26 comments)

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  •  Don't think it can be done easily, if at all. (1+ / 0-)
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    If you look at the Dodd-Frank law you will find this section:

    SEC. 1301. SHORT TITLE.
    This title may be cited as the ‘‘Pay It Back Act’’.

    Section 115(a) of the Emergency Economic Stabilization Act of 2008 (12 U.S.C. 5225(a)) is amended—

    (1) in paragraph (3)—

    (A) by striking ‘‘, $700,000,000,000, as such amount is reduced by $1,259,000,000, as such amount is reduced by $1,244,000,000’’ and inserting ‘‘$475,000,000,000’’; and

    (B) by striking ‘‘outstanding at any one time’’; and (2) by adding at the end the following:

    ‘‘(4) For purposes of this subsection, the amount of authority considered to be exercised by the Secretary shall not be reduced by—

    ‘‘(A) any amounts received by the Secretary before, on, or after the date of enactment of the Pay It Back Act from repayment of the principal of financial assistance by an entity that has received financial assistance under the TARP or any other program enacted by the Secretary under the authorities granted to the Secretary under this Act;

    ‘‘(B) any amounts committed for any guarantees pursuant to the TARP that became or become uncommitted;


    ‘‘(C) any losses realized by the Secretary.

    ‘‘(5) No authority under this Act may be used to incur any obligation for a program or initiative that was not initiated prior to June 25, 2010.’’.

    As such, no TARP funds of any kind can be re-purposed unless they can try to shoe-horn it into a revamp of an existing program.

    Actually if you look at that section of the law you will also find that funds paid to the Treasury from the  HOUSING AND ECONOMIC RECOVERY ACT OF 2008 regarding sales or repayments of monies related to Fannie Mae, Freddie Mac, Federal Home Loan Banks including fees MUST be used to reduce the deficit and may not be re-purposed.

    You will also find that the same is true of unused ARRA funds in the case where the Federal government offered funds to a state and the state refused the money. That money also MUST be used to reduce the deficit and cannot be re-purposed.

    Finally, unallocated ARRA funds carry the same provision, however, there is an exception allowed by a Presidential waiver to allocate those funds after December 31, 2012.

    Congress were quite the deficit hawks last July in getting Dodd-Frank passed.

    •  Sorry. Didn't mean 'TARP'. Meant 'HAMP'. (1+ / 0-)
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      And in that case, it would most certainly be using those funds for their intended purpose (relieving homeowners) in a manner that cuts through many of the problems that exist with the current program.

      Corporate Dog

      We didn't elect Obama to be an expedient president. We elected him to be a great one. -- Eugene Robinson

      by Corporate Dog on Sat Aug 27, 2011 at 03:59:42 AM PDT

      [ Parent ]

      •  HAMP and the short sell program (0+ / 0-)

        Were funded with TARP money from my understanding of those programs. I would have to go back and look but the COP reports covered the topic of HAMP so I am inclined to believe that TARP was the source of funding of the program.

    •  Assuming the WH knew what was in the law (1+ / 0-)
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      they then chose not to spend money that could have helped address the economic crisis.  Given that TARP, HAMP and ARRA were all designed to give an immediate boost to the economy, it's odd that the WH chose to sit on any of this money until they were statutorily required to give it back.  This shows that it's not true that there was nothing the WH could do without additional legislation.

      One more thing - real deficit hawks don't cut spending in a recession, because they understand that economic growth is the only way to address the deficit in the short term, and addressing health care costs is the only way to reduce the deficit in the long term.  Reducing one time spending does not help lower the deficit.

      Politics is the art of the possible, but that means you have to think about changing what is possible, not that you have to accept it in perpetuity.

      by David Kaib on Sat Aug 27, 2011 at 07:22:28 AM PDT

      [ Parent ]

      •  The interesting thing about TARP was (1+ / 0-)
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        Brian B

        That at the time of the Dodd-Frank legislation there was somewhere in the neighborhood of $200 billion that wasn't allocated for anything.

        When it extending the extended unemployment benefits multiple times in 2009 and 2010 came with Pay Go rules and at no time was unallocated TARP money ever used for such purposes as the Senate Republicans wouldn't give the one cloture vote needed. There was no fight for it to be used even though some Democratic Senators had stated such proposals. Instead cuts were made to extra benefits in SNAP and unemployment checks that were part of ARRA and later in the Small Business Lending Fund (which was another backdoor bailout to smaller TARP banks) cuts were made to SNAP and the Earned Income Tax Credit in 2014 (actual cuts not elimination of additional due to ARRA).

        All of this before we got anywhere near the Bush Tax cut extension and naturally before the whole continuing resolution fight in the spring of this year to keep the government running and before the whole debt ceiling debacle and before we get to the budget and before we get to the "super" committee fiasco coming up.

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