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ProPublica reports on the estimated $30 billion left from the Trouble Asset Relief Program that was intended to help homeowners.
[...]Congress has mandated that the leftover money be used to pay down the debt.

Of the $45.6 billion in Trouble Asset Relief Program funds meant to aid homeowners, the most recent numbers available show that only about $2 billion has actually gone out the door.[...]

The programs have been marked by poor oversight and consistent under-enrollment. Homeowners have been forced to navigate an often bewildering maze at banks marked by slow communication, lost documents and other mistakes.

The amount of money spent is also low because the government pays out its incentive over a number of years. As of July, according to a Treasury spokeswoman, the government is on track to eventually spend $7.2 billion helping homeowners enrolled in its main loan modification program. That number doesn't factor in other homeowners who may enter the program before it ends in December 2012, but it does assume that all homeowners currently in the program will be able to continue making payments.[...]

According to the original TARP legislation, unused funds should be returned to the Treasury and used to reduce the debt. While Congress has the power to re-route those funds into new programs, Republicans seem unlikely to endorse such a plan.

Congress wouldn't have to reroute those funds, however, for them to actually be used to provide homeowner relief. Yes, unused funds have to be returned, but those funds don't have to remain unused. There are things that should have been done on the housing front, and some that still could.

Putting that money to work to actually help homeowners would have at least some stimulative effect, and do a lot more for the overall economy than putting it toward the deficit. It's not like that would make the Republicans not press for more cuts, anyway.

Originally posted to Joan McCarter on Fri Aug 26, 2011 at 02:05 PM PDT.

Also republished by Daily Kos.

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Comment Preferences

  •  Tip Jar (31+ / 0-)

    "There’s class warfare, all right, but it’s my class, the rich class, that’s making war, and we’re winning." —Warren Buffett

    by Joan McCarter on Fri Aug 26, 2011 at 02:05:20 PM PDT

    •  I am waiting for any FPager to do an article (5+ / 0-)

      entitled:  Why Timothy Geithner is the last remaining Economic Adviser left on Obama' team.  I don't suppose that is coming anytime soon, right, Joan?

      Please, let me know when that 'post' is about to come out.  Of course, billions that were slated for homeowners will go to the deficit.  

      That is not rocket scientist shit here.  It is the same shit day in and day out:  there will be no return to accountability and laws in our nation.  The Banks and Wall St, and the MIC will continue to be protected, no matter what it costs the people of our nation.   They will suck us dry, and Obama will lead the charge.  He is doing a great job, and we can no longer deny that.  The perfect guy, for the perfect job.  

      I honestly wish it were not so, but I'm not going to make excuses for him, for the rest of the Democrats, or for Richard Trumka.  When they stand up for us, we will stand up for them.  I'm way tired of the 'vote for me, or get worse meme.'  

      I want an effective meaningful leader in our Party.  I guess that is too much to ask now.  

      Thanks for a great article.  Ms. B.

  •  who here thinks that (9+ / 0-)

    this settlement money that the WH is pushing for in the Bank Fraud Settlement being negotiated, which Obama promised would go to help homeowners, won't end up going to reduce the deficit too?

  •  Homeowner relief? (3+ / 0-)
    Recommended by:
    Russgirl, Badabing, judyms9

    Republicans would rather relieve people of their homeownership. Good for dem banks, dontchaknow.

    14 years old and fighting like heck to make a difference, Tomorrowsprogressives.com

    by TomorrowsProgressives on Fri Aug 26, 2011 at 02:58:27 PM PDT

  •  Who Thought It Was Ever Going to Homeowners (6+ / 0-)
    Recommended by:
    Edger, BigOkie, Badabing, magnetics, chuckvw, Drewid

    anyway?

    We are called to speak for the weak, for the voiceless, for victims of our nation and for those it calls enemy.... --ML King "Beyond Vietnam"

    by Gooserock on Fri Aug 26, 2011 at 03:30:31 PM PDT

  •  That poor starving, homeless deficit (4+ / 0-)
    Recommended by:
    BigOkie, Badabing, aliasalias, chuckvw

    and all those sunken eyed emaciated investment bankers living hat in hand wandering the sidewalks of New York are finally going to get some relief?

    Oh happy day. And whoever thought this administration didn't care and wouldn't come through in the clutch?

    Nothing like renewed sense of hope and faith to put a spring in my step and make the sun shine.

    Antemedius | Liberally Critical Thinking

    by Edger on Fri Aug 26, 2011 at 04:18:50 PM PDT

  •  congress = Hoover (n/t) (1+ / 0-)
    Recommended by:
    Badabing

    "Your victory has demonstrated that no person anywhere in the world should not dare to dream of wanting to change the world for a better place." -- Mandela

    by agoldnyc on Fri Aug 26, 2011 at 04:57:02 PM PDT

  •  So even where Congress (2+ / 0-)
    Recommended by:
    Badabing, chuckvw

    has given money to the WH for the purposes of addressing the housing crisis, the WH doesn't take the bait. I don't pretend to know their motives, but it is clear that for whatever reason, the WH is uninterested in helping homeowners (and by extension, the recession that this crisis is contributing to).  

    And still a few people want to say it's all Congress' or the Republicans' fault.

    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 Fri Aug 26, 2011 at 05:22:55 PM PDT

  •  This is the proof: WH Settlement = Smokescreen. (7+ / 0-)

    As I commented yesterday...

    http://www.dailykos.com/...

    ... Geithner has the authority to make changes to TARP so that the money could more easily flow to homeowners. In fact, a number of Democratic House members are pushing him to make changes that would allow the unused funds to be paid-out in almost EXACTLY the same manner that the White House is proposing for the settlement funds.

    But Geithner isn't budging.

    So they've got plenty of funding through TARP to help homeowners, and they have the means to use it. The only reason why they WOULDN'T, at this point, is so that they can claim the settlement funds are the ONLY way to help with loan modifications, push through a weak settlement, and keep their Wall Street donors from having to do a frog march.

    Regards,
    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 Fri Aug 26, 2011 at 07:19:22 PM PDT

    •  Don't think it can be done easily, if at all. (1+ / 0-)
      Recommended by:
      Odysseus

      If you look at the Dodd-Frank law you will find this section:

      TITLE XIII—PAY IT BACK ACT
      SEC. 1301. SHORT TITLE.
      This title may be cited as the ‘‘Pay It Back Act’’.

      SEC. 1302. AMENDMENT TO REDUCE TARP AUTHORIZATION.
      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;

      or

      ‘‘(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-)
        Recommended by:
        MindRayge

        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.

        Regards,
        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-)
        Recommended by:
        MindRayge

        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-)
          Recommended by:
          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.

  •  So in the article... (2+ / 0-)
    Recommended by:
    Badabing, Drewid
    Congress has mandated that the leftover money be used to pay down the debt.

    Is "Congress" the Tea Party-controlled Congress, or was it the one that had Nancy Pelosi as Speaker, that mandated this?

  •  The leftover money will not be used to pay (0+ / 0-)

    down the deficit if the GOP sees another war they'd like to wage, perhaps Syria and/or Iran.  This will keep the bloodlusty military contractors contibuting to their campaign coffers.  And this time it will be Congress that declares war while watching Obama standing and scratching his head.

  •  That F-ing TARP (1+ / 0-)
    Recommended by:
    Odysseus

    Never did anyone any good to bail out billionaires. At least one of my Senators had the sense to vote Nay. (And the other beat the Republican incumbent by opposing it.)

    "I want my Obama back!!!"

    by Pale Jenova on Fri Aug 26, 2011 at 09:22:11 PM PDT

  •  Makes far too much sense too spend this on... (0+ / 0-)

    ...the actual problem it was supposed to address.  Better to fuck over the homeowners, declare victory and allow both Obama and the other conservatives (the GOP) to congratulate themselves on supporting the kleptocracy!

    If you ask "what color is the poster" when someone criticizes the President's policy or track record, you are probably a racist. If you assume white progressives don't like the President's policies because of his skin color, you are definitely a racist.

    by Celtic Pugilist on Fri Aug 26, 2011 at 10:11:54 PM PDT

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