More details are coming out about the meeting yesterday between President-elect Obama and President Bush.
Sources tell ABC News the general message Obama conveyed was: Let’s not wait for a new president before action is taken on the economy.
Obama focused on three basic items:
1) Working with the Congress to pass an economic stimulus package during the lame-duck Congress;
2) Using existing presidential authority to help the Big Three automakers, who are all on the brink of bankruptcy.
There are two primary ways President Bush could provide aid, either through the recently passed $25 billion in federal loans to help automakers retool (though automakers might needs those funds simply to make payroll) OR through the $700 billion in TARP (Troubled Assets Relief Program) funds, less than $500 billion of which has been allocated.
The Big Three automakers have asked for an additional $25 billion to help prevent their going into bankruptcy. On Saturday, House Speaker Nancy Pelosi and Senate Majority Leader Harry Reid asked Treasury Secretary Henry Paulson to consider using the TARP funds to help the automakers, though the White House seemed to reject that idea on Monday;
3) Stepping up on spending the TARP funds to help people survive the housing crisis.
Adjustable rate mortgages for a lot of people struggling to make mortgage payments are about to expire, and their interest rates will go up. Obama (and others) are concerned that will cause more defaults, creating even more instability in the housing and financial sectors. There’s not enough action being taken on housing, Obama believes.