TPMtv caught up with House Financial Services Committee Chairman Barney Frank (D-MA) today to talk about the full plate of economic challenges — from the bailout to the stimulus — that faces the president-elect and the new Congress this year.
Ever since the Democratic Congress decided simply to trust the incoming administration to spend its half of the $700 billion financial bailout more wisely than George Bush, I’ve been wondering why they didn’t just pass a law setting those conditions. Incoming White House economic adviser Larry Summers has sent two letters to Congress detailing the Obama team’s plans to use its $350 billion lifeline more responsibly — but even the most well-intentioned letter doesn’t have the force of law.
So it was a relief to hear today from Frank that Congress is reserving the right to play bad cop if banks resist the Obama administration’s call for more foreclosure aid, for example.
Frank said that his bailout oversight bill will be a “sword of Damocles” hanging over the financial industry (not to mention the executive branch). If the second $350 billion isn’t being spent the way that Democratic lawmakers or the Obama team envisioned, Frank explained, his bailout oversight bill can be passed by the Senate “in a very short period of time.”