April 30, 2009




Dear Mr. Jason:



Thank you for contacting me regarding the Let Wall Street Pay for Wall Street's Bailout Act of 2009 (H.R. 1068). I appreciate hearing from you on this issue.

On October 3, 2008, former President George W. Bush signed into law the Emergency Economic Stabilization Act. This act created the $700 billion Troubled Asset Relief Program (TARP), which allowed the Treasury Department to stabilize the financial system by providing assistance to financial institutions. When Congress passed the bill, we put in stipulations that the money would need to be paid back within five years and an oversight panel would be established to report to Congress every 60 days about how TARP is achieving its intended goal of stabilizing the markets.

It quickly became apparent that the TARP program needed improvements. The oversight panel reported on January 9, 2009, that the program needed improvements in key areas. The panel called for more transparency and accountability in the stabilization of banks along with measures to stem the foreclosure rate.



Americans across the country have voiced concern that firms are not making a sufficient amount of credit available to smaller banks and small businesses; that credit card companies are raising interest rates even on customers who pay their bills on time; and that company executives continue to receive extravagant bonuses.



The Obama Administration has taken several steps to address these concerns and has launched a website that details every step taken by the Administration to stabilize the markets: http://financialstability.gov/.



Representative Peter DeFazio of Oregon introduced the Let Wall Street Pay for Wall Street's Bailout Act of 2008 (H.R. 1068), which proposed to pay for the TARP by requiring securities-trading facilities to pay an excise tax on the value of securities and commodities transactions, in order to recoup the money used in the TARP.



Proponents of the bill argue that this legislation puts the burden of paying for TARP on those institutions that received government assistance and the benefits of the program. Opponents of the bill argue that that this legislation would create an additional burden on the institutions the program is working to assist thereby counteracting the original purpose of the program.



The Let Wall Street Pay for Wall Street's Bailout Act of 2008 has been referred to the House Ways and Means Committee. There is no corresponding legislation in the Senate. I will keep your views in mind should similar legislation be debated on the Senate floor.



Thank you again for contacting me. Please feel free to keep in touch.



Sincerely,

Richard J. Durbin

United States Senator