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Stimulus

Stimulus foes see value in seeking cash

Sen. Christopher S. Bond regularly railed against President Obama's economic stimulus plan as irresponsible spending that would drive up the national debt. But behind the scenes, the Missouri Republican quietly sought more than $50 million from a federal agency for two projects in his state. Mr. Bond was not alone. More than a dozen Republican lawmakers, while denouncing the stimulus to the media and their constituents, privately sent letters to just one of the federal government's many agencies seeking stimulus money for home-state pork projects.

Senators’ Propose 50% Bonus Tax on Banks That Got Bailout Funds

Senate Democrats Barbara Boxer and James Webb proposed a 50 percent tax on bonuses of more than $400,000 at financial firms including Goldman Sachs Group Inc. and Bank of America Corp. that received U.S. bailout money. Boxer of California and Webb of Virginia introduced legislation to put a one-time levy on the bonuses of employees at banks that took at least $5 billion from the Troubled Asset Relief Program, the senators said yesterday at a Washington news conference.

AIG’s Russo Faces Investor Suits, SEC Probe in New Legal Role

American International Group Inc.’s new general counsel, Thomas Russo, faces regulatory probes and lawsuits from investors, clients and competitors as the insurer seeks to retain employees and repay its U.S. bailout. Russo, 66, the former top attorney at Lehman Brothers Holdings Inc., needs to minimize the disruption from AIG’s legal entanglements and satisfy lawmakers examining the New York-based insurer’s $182.3 billion rescue.

Stimulus Report Adds Fuel to Fight on Jobs

Recipients of economic-stimulus money said 599,108 workers were being paid by the funds in the last quarter of 2009, fewer than the number of jobs attributed to the package in the seven months after it was enacted. The recipients' reports, published on the official government Web site recovery.gov late Saturday, are likely to fuel further controversy over the impact of the $787 billion package, as Democrats craft new jobs-creation proposals to address the country's 10% jobless rate.

Something New for BofA: Washington's Ear

One month into his new job, Bank of America Corp. Chief Executive Brian Moynihan is putting in as much time in Washington as he does in the bank's hometown of Charlotte, N.C. It started with a two-day whirlwind of meetings: Federal Reserve Chairman Ben Bernanke, Treasury Secretary Timothy Geithner, Federal Deposit Insurance Corp. Chairman Sheila Bair and Comptroller of the Currency John Dugan, say people familiar with the situation.

AIG Draws Another $2.4 Billion From Fed Credit Line

American International Group Inc., the insurer bailed out by the U.S., increased its borrowing under a Federal Reserve credit line by the most since October to repay debt from an expiring government commercial paper program. AIG owes $25.8 billion on the five-year line, about $2.4 billion more than last week, according to Fed data released late yesterday. The draw has increased for six straight weeks.

Fed Lays Ground for End to Stimulus With Recovery Declaration

The Federal Reserve panel in charge of interest rates declared for the first time the U.S. economy is in “recovery” and took several steps to prepare investors for the removal of aggressive monetary stimulus. The Federal Open Market Committee yesterday upgraded its economic outlook, reaffirmed it will end liquidity backstops and a $1.25 trillion program to buy mortgage-backed securities and expressed less confidence inflation will remain “subdued.”

Stimulus cash doesn't create local jobs

A federal spending surge of more than $20 billion for roads and bridges in President Obama's first stimulus has had no effect on local unemployment rates, raising questions about his argument for billions more to address an "urgent need to accelerate job growth." An Associated Press analysis of stimulus spending found that it didn't matter if a lot of money was spent on highways or none at all: Local unemployment rates rose and fell regardless.

GMAC Gets $3.8 Billion More in Aid

The Treasury Department said on Wednesday that it would give $3.8 billion more to GMAC Financial Services and become the auto lender’s majority owner because GMAC had been unable to raise sufficient capital on its own. It will be the third round of government financing for GMAC, bringing taxpayers’ total investment to $16.3 billion at a time when other lenders rescued by the Treasury have already begun repaying their debt, The New York Times’s Nick Bunkley reported.

Stiglitz Says U.S. Should Prepare for Second Stimulus

Nobel Prize-winning economist Joseph Stiglitz says the U.S. needs to prepare for a second stimulus package as there’s a “significant” chance growth will slow in the second half of 2010. The world’s largest economy isn’t likely to expand fast enough to create jobs for new entrants into the labor force or compensate for increases in productivity that will reduce demand for workers, Stiglitz told reporters in Singapore today.