Question

What were some of the main issues in the evolution of the legislation, from the 4 page "Break-the-Glass" posted on Sept. 20, 2008, to the legislation passed on Oct. 3, to the changes made by the Secretary of Treasury on Oct. 12?

Answer 1

Meetings on the most appropriate plan, the Government could draw up to prevent a banking crisis, that started in mid-April 2008, 30 days after the rescue of Bear Stearns. Bernanke, and, Paulson discussed a 10-page memo, with the title, Break the Plan recapitalization plan, drawn up Neel Kashkari, and, Philip Swagel from the Treasury. The Plan proposed the buying off of toxic assets from financial institutions, by asking the Congress for $500 billion. The initiative failed to gather the support of the Bush Administration, as the crisis did not appear bad enough in 2008. By mid-September, the Bush Administration, termed, tabled the plan again, naming it Troubled Asset Relief Program. 3-page memo turned into a 40-page document in the Senate. Congress voted on TARP in September 2008 rejecting the proposal, 228-225. A revised version was voted in October 1, passed in the house on October 3, 2008. The President signed the Emergency Economic Stabilization Act of 2008, the same day. Treasury created a $700 billion fund.