Pelosi: House Will Take Up TARP Reforms Next Week

Place this in the “legislative-futility” column.

Just a few hours after the Senate voted yesterday to grant the Obama administration its request for the second $350 billion in Wall Street bailout cash, House Speaker Nancy Pelosi (D-Cal.) said the lower chamber will still consider its bailout-reform bill next week. From Pelosi’s statement:

The Senate has cleared the release of the second half of TARP, but now the process must ensure that there will be full accountability and transparency to the taxpayers and that substantial assistance will go to homeowners facing foreclosure. [...]

With Chairman [Barney] Frank’s legislation, Congress will ensure that financial institutions using taxpayer funds provide credit to consumers and small businesses, commit at least $100 billion for foreclosure mitigation, and end golden parachutes for executives of financial institutions receiving TARP assistance.

It’s a noble goal. Despite President-elect Barack Obama’s vows to spend the TARP money differently and with more more transparency than the Bush administration did — Obama, for example, says he’ll use between $50 billion and $100 billion mitigate foreclosures, something that Bush officials refused to do — those promises are nonbinding. The commitment to spend at least $50 billion on the housing crisis arrived as part of a three-page letter sent yesterday from top Obama economic adviser Lawrence Summers to congressional leaders. The House bill would make that spending a legal obligation.

No matter. Senate Democrats appear unlikely to take up the Frank bill, even if Pelosi and the House Democrats pass it next week — and unlike the release of the second $350 billion, Frank’s bill would require both House and Senate passage, not to mention Obama’s signature.

Meet the new TARP. Same as the old TARP.