Treasury Secretary Timothy Geithner today unveiled details of the Obama administration’s plans to address the worst U.S. financial crisis since the Great Depression more than seven decades ago.Initially dealing with the second half of the $700 billion banking bailout approved under the Bush administration, the new Obama administration program could eventually channel up to $2 trillion of public and private money to unfreeze the credit markets and get the economy moving again.
Treasury Secretary Timothy Geithner speaks
at the Treasury Department in Washington,
Tuesday, Feb. 10, 2009, detailing the Obama
administrations economic recovery plans.
(AP Photo/Lawrence Jackson)
“We have to both jump-start job creation and private investment,” Geithner said, “and we must get credit flowing again to businesses and families.”Speaking at the Treasury Department in Washington, DC, Geithner declared, “Right now critical parts of our financial system are damaged. Instead of catalyzing recovery, the financial system is working against recovery, and that’s the dangerous dynamic we need to change.
Beyond placing a previously announced $500,000 salary cap on the top executives of participating banks and other financial institutions, according to an Associated Press report, the Obama plan would “impose tough new standards on future payments to banks. It is also greatly expanding an effort to unclog credit markets to provide loans to consumers and businesses.”
A key focus, AP reported, will be funding to loosen banking limits on credit card debt, auto loans and student loans from $20 billion to $100 billion. In combination with a program operated by the Federal Reserve, the effort “would be enough to support an additional $1 trillion of lending in this area. Officials said the program would also be expanded beyond consumer and small business loans to cover loans for commercial real estate projects.”