A Gallup poll released last Thursday found that Americans want more information as to how the financial bailout funds will be used.
In general, the threat of blocking the release of the TARP funds appears to be one with which the average American is sympathetic. Given three choices of what to do with the remaining funds, 62% say Congress should block the release "unless more details are provided about how the funds will be used," and another 12% say Congress should block the funds entirely. Only 20% favor Congress' simply allowing the funds to be released.
In a sense it's a moot point, because the Senate voted last week to give President Barack Obama access to the second chunk of $350 billion. But the larger issue is that Americans appear quite unhappy with how the first portion of the bailout cash was managed. Critics have grumbled that the hundreds of billions of dollars in tax-payer money that was injected into banks did not spark an increase in lending. (Instead, funds have been used mostly to beef up bank balance sheets and in some cases to finance acquisitions.)
The Obama administration did attempt to tackle this issue in a letter from incoming National Economic Council director Larry Summers to top lawmakers. In it, Summers promised to closely track where the cash is put to use, add new restrictions on executive pay and impose limitations on the use of bailout cash to finance acquisitions. We'll have to wait and see what impact such reforms have on the public's perception of the bailout. But no matter how you spin it, handing out hundreds of billions of dollars to banks is never going to be real popular.