TAPPER: A year ago when you and the president introduced the mortgage modification program…
OBAMA: "Under this plan, lenders who participate will be required to reduce those payments to no more than 31 percent of a borrower's income. And this will enable as many as 3 to 4 million homeowners to modify the terms of their mortgages to avoid foreclosure."
TAPPER: If a year ago I had told you that today I'd be sitting here, and only 66,000 Americans had permanent mortgage modifications, would you have said at the time that that was a success?
GEITHNER: Oh, Jake, I think it's very important to recognize this program is providing very, very substantial cash flow relief right now to more than three quarters of a million Americans. And we -- we believe we're still on a path to be able to reach many, many more American households. And of course we're going to make sure that those temporary modifications translate into permanent modifications. But again...
TAPPER: But a lot of those temporary modifications were done verbally though. They weren't done with the paperwork that a lot of...
GEITHNER: No. We're -- we're absolutely committed to make sure that translates into what we said it would, which is for eligible Americans -- they're getting permanent modifications that substantially lower their monthly payment. Now, Jake, remember like, you know, again for the average household that translates into hundreds and hundreds of dollars every month for them.
That is real benefits -- great -- has greater income for them to meet their basic needs. But again step back for a sec. In February and March of last year house prices were falling off the cliff. People thought house prices might fall another 20 -- 30 percent. And we've had six months now of early signs of stability in house prices. So what that means is millions and millions of Americans -- middle class families across the country are now seeing more stability, and what is a basic source of financial security for all Americans.
Those programs were enormously effective in helping again pull a housing market that was in near collapse back to the point now where you're seeing the signs of stability.
TAPPER: Recently the president introduced a way of attacking the issue of banks that are too big to fail. He called it the so-called, "Volcker rule." Some sources close to you said that you had some concerns about that rule. What were those concerns?
GEITHNER: Oh, I am committed, and the president is committed to make sure that the reform package Congress moves forward -- puts in place tough, conservative, effective constraints in risk taking on the largest institutions in the country. And I am very confident we're going to be able to do that. This is an important part of that.
And I'm very supportive again of this basic principle. You want to make sure that institutions that have the privilege of access to the safety net the government provides aren't allowed to use that to subsidize the kind of risky activity that could bring the financial institutions to the edge of collapse.
TAPPER: And you are also concerned that you want -- you didn't want these American firms to be unable to compete with the...