US Treasury Secretary Henry Paulson and Federal Reserve Chairman, Ben Bernanke have waged a stout defense of their management of the 700 billion dollar Troubled Asset Relief Program, or TARP, to bail out ailing financial institutions.
They said the unpredictable nature of the current financial crisis meant it was necessary to ensure that financial bailout money was not diverted to other use.
On Tuesday, Paulson testified before the House Banking Committee in Washington. He said focusing the bailout program on infusing billions into banks...to pump capital and bolster lending... is a faster way to stabilize the financial system instead of simply buying rotten assets as was originally proposed.
He said it's crucial that the administration be nimble in assessing changing conditions and adapt the bailout strategy accordingly.
Paulson is opposed to dipping into the government's financial bailout fund for a rescue package for the three major automakers, no matter how badly they need the help.
