White House Eyes TARP Cash to Slash Deficit

Voters are waking up to president's free-spending ways

(NEWSER) - President Obama is trying to sound like he's turning tough on the deficit and federal spending in his State of the Union address, but Karl Rove isn't impressed and Americans shouldn't be, either. Obama has "rigged the game" by boosting discretionary domestic spending by more than $100 billion from George W. Bush's last budget and giving himself plenty of room to make cuts, Rove writes in the Wall Street Journal. More»

(NEWSER) - Here's the latest eye-popping number produced by the recession: $1.6 trillion. The White House and CBO today projected that figure as this year's deficit, reports the New York Times. While it would be the biggest since World War II, the figure is actually about $260 billion better than anticipated in May. Still, the red ink is expected to reach $9 trillion over the next decade, says the White House. More»

TARP funds, meant to save banks, could be used to save jobs

(NEWSER) - The Obama administration is working on a plan that would take money from the TARP—the $700 billion fund intended to rescue banks—and lend it to small businesses, the Washington Post reports. The money would come with few restrictions, and the government would pick up as much as 90% of the tab should the businesses fail. Most of the country’s jobs, proponents argue, come from companies with fewer than 500 employees. More»

Washington refuses state's requests for aid

(NEWSER) - California may be the world’s 8th-largest economy and key to President Obama’s re-election, but requests for financial aid are falling on deaf ears in Washington, Politico reports. The Golden State remains deadlocked over a $24 billion budget deficit, and many of its own officials are unsympathetic. “Why would we bail out the state when it’s like giving drugs to a drug addict?” asked one congressman. More»

Salary caps will be dropped, but bonus restrictions remain

(NEWSER) - The Obama administration has scrapped plans for salary caps at banks and other firms that receive government bailout money, reports the Wall Street Journal. But congressional limits on bonuses will remain in force, and the White House will still push for major changes to executive compensation. The double whammy of executive and legislative pay provisions had spooked Wall Street and pushed 10 banks to repay $68 billion in TARP money yesterday. More»