According to Associated Press, Obama would devote $40 billion to $100 billion from the financial sector bailout fund to help homeowners avoid defaulting on their mortgages and extend loans to small businesses, consumers, homeowners and local governments. The legislation now limits on what financial institutions can do with bailout money and restrictions on executive pay and sets aside money for foreclosure mitigation. Such a commitment is the most specific glimpse at what Obama would do with the remaining $350 billion of the Troubled Asset Relief Program. Congress built in a safeguard by requiring that after the first $350 billion was spent; Congress could reject spending the second half. Republicans generally opposed the $700 billion bailout program when Congress first voted for it in October. With Democrats holding a stronger majority in House and Senate, even more Republicans were voicing opposition to spending the money.

Both parties have complained that the Bush administration did not spend the money as it initially intended. Treasury Secretary Henry Paulson told legislators last year that the money would be used to buy toxic assets held by the banks in hopes that would help them make more loans. But the Treasury soon changed course and used the money to make direct infusions of capital into financial institutions with few strings attached. Lawmakers complained that the money has not appeared to loosen credit. In reality it didn't. I spoke with a friend who works as the Treasurer at a bank. The money they were granted from the bailout program didn't do what it was intended to do. There's no reason for the bank to lower the credit standards and expose itself to more credit risk in an already deteriorated economic environment. The money was used 2 "inject" liquidity in the capital market by buying securities. We can only hope that our tax money will be in a better use and more transparent.