Obama Can't Spend TARP However He Pleases: Oversight Chair

Elizabeth Warren, the Harvard law professor who heads Congress' bank bailout oversight panel of outside experts, put President Barack Obama on notice that he can't spend money from the fund on job creation without getting congressional approval unless he wants a fight from her.

She made her comments during a CNBC Wednesday morning.

An transcript of the relevant remarks:

"If the administration wants to put more TARP dollars through financial institutions say into small business lending and in turn that creates jobs you can do that with TARP money. But if less TARP money is spent, that doesn't mean it can be used automatically in a jobs program somewhere else. To spend money in a jobs program somewhere else, Congress has to make that decision...

... The original language has specificity about the way in which the money can be used. That is, it has to do within the financial system, the money has to go in through the banking system and other parts of the financial system although it was quit explicit about some broad goals — mortgage foreclosure, it's about what was happening in the real economy, restarting credit.

It is not simply a slush fund to be used on anything anyone wants to do no matter how worthy. And I want to be clear; so far they haven't done it and the oversight panel would be up in arms if they tried. So, so far, they haven't gotten close to that line."

Her comments come at about the 3:20 point in the video.












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