The legality of this needs to be questioned.........those in power need to be held accountable on this, because it's a shell-game.
Obama likes both sides of an argument
Fact check » Sometimes reality poses a different view.
The Associated Press
Updated: 12/08/2009 05:50:14 PM MST
In President Barack Obama's hands, the $700 billion financial rescue fund offers a bit of bookkeeping magic: an opportunity to pay down the deficit while also spending more -- thereby adding to it.
Under law, any paybacks to the bailout known as the Troubled Asset Relief Program must be used to reduce the deficit. But in an economic speech on Tuesday, the president sought to have it both ways. Increased repayments from banks to the Treasury will reduce the deficit all right, but it will give Congress the budgetary room to spend more -- and the president encouraged just that.
It wasn't the president's only attempt at having his cake and eating it, too, in his speech:
OBAMA » "We were forced to take those steps largely without the help of an opposition party which, unfortunately, after having presided over the decision-making that led to the crisis, decided to hand it over to others to solve," he said, describing his administration's infusions of money to banks and the auto industry.
Later, however, he conceded that the TARP program was "launched hastily under the last administration," and argued the policy was flawed.
THE FACTS » Obama's partisan swipe glosses over some of the circumstances before he took office. First, he and his fellow Democrats presided over some of the decision-making that led up to the crisis, because they controlled Congress for two years before Obama became president. Obama's
Treasury Secretary Tim Geithner also had a hand, as chief of the Federal Reserve Bank of New York under the Bush administration.
Moreover, the $700 bailout fund was initiated under the Bush administration by then Treasury Secretary Henry Paulson. It was endorsed at the time by Federal Reserve Chairman Ben Bernanke and by Geithner. As Illinois senator during the presidential campaign, Obama backed that package.
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OBAMA ON TUESDAY » "Even as we have had to spend our way out of this recession in the near term, we have begun to make the hard choices necessary to get our country on a more stable fiscal footing in the long run."
OBAMA, LAST WEEK »"We are under no illusion that somehow the federal government can spend its way out of this recession, but it is absolutely true that any of the ideas that have been mentioned here are still going to require some public dollars and those are actually good investments to make right now."
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OBAMA » "We cannot continue to accept an education system in which our students trail their peers in other countries."
THE FACTS » The long-held perception that U.S. pupils lag those in other countries has been based on misleading comparisons, and is getting outdated in any event. Developed Asian countries do tend to be ahead, but the U.S. has been gaining for many years, making bigger strides on international tests than Singapore and Japan in math, and more progress than Japan in science. The U.S. is highly competitive with Europe, including Britain, Russia and Germany. Global assessments do not account for the fact that U.S. is growing ever more diverse, with a large share of children who are learning English.
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OBAMA » "We've made college more affordable."
THE FACTS » He's piloted short-term relief but nothing to restrain college costs for students over the long term. Pell Grants for low-income students received a one-year boost of 13 percent, more than the growth of tuitions. As well, Obama's stimulus law gives college tax credits to more parents and students over the next two years.
Over the next decade, however, his proposals, if accepted by Congress, would increase Pell Grants by an average of about 2.6 percent yearly. That's actually slower growth for Pell Grants than in the past and it would not keep up with tuition increases, which have averaged 7 percent annually since the grants began. Moreover, Obama's proposed changes in student lending are designed to save the government money, not students with loans. Some of the envisioned savings would go to other areas of education, not college.
