Senate votes to send last $350B of TARP to Obama

The Senate on Thursday narrowly approved granting the final half of the $700 billion bailout package to the incoming Obama administration.

In a 42-52 vote, the Senate rejected a resolution sponsored by Sen. David VitterDavid Bruce VitterSenate confirms Trump judge who faced scrutiny over abortion views Collins votes against Trump judicial pick Progressive group targets Susan Collins over Trump judicial pick MORE (R-La.), disapproving the release of the funds.

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Most Republicans supported Vitter, with 33 voting in favor of not releasing the funds. Most Democrats, including their leadership team, voted to support giving the funds to President-elect Obama.

Senate Minority Leader Mitch McConnellAddison (Mitch) Mitchell McConnellOn The Money: Treasury rejects Dem subpoena for Trump tax returns | Companies warn trade war about to hit consumers | Congress, White House to launch budget talks next week | Trump gets deal to lift steel tariffs on Mexico, Canada Schumer calls on McConnell to hold vote on Equality Act House Dem cites transgender grandson in voting for Equality Act MORE (R-Ky.) and Sen. John McCainJohn Sidney McCainMSNBC host: Barr 'the most dangerous person' who works for Trump Several factors have hindered 'next up' presidential candidates in recent years Small Florida county that backed Trump one of two targeted by Russians: reports MORE (Ariz.), the 2008 GOP presidential candidate, both voted against releasing the funds.

The $700 billion package known as the Troubled Asset Relief Program (TARP) has been criticized heavily by lawmakers, the Government Accountability Office and the congressional oversight panel established to investigate how the funds are spent. The first $350 billion of the package has already been committed by the Treasury.

Obama released a statement praising the vote.

“Restoring the economy requires that we maintain the flow of credit to families and businesses. So I’m gratified that a majority of the U.S. Senate, both Democrats and Republicans, voted today to give me the authority to implement the rest of the financial rescue plan in a new and responsible way,” Obama said. “I know this wasn’t an easy vote because of the frustration so many of us share about how the first half of this plan was implemented.”

Senate Majority Leader Harry ReidHarry Mason ReidLobbying World Mitch McConnell is not invincible Seven big decisions facing Biden in 2020 primary MORE (D-Nev.) rallied the Senate to reject the disapproval resolution on the grounds that the new president would learn from the mistakes in the way the initial funds were used.

Barack ObamaBarack Hussein ObamaBiden calls for unity, jabs at Trump in campaign launch Several factors have hindered 'next up' presidential candidates in recent years Lewandowski: Why Joe Biden won't make it to the White House — again MORE has made it clear that he understands the mistakes of the prior administration and will not repeat them,” Reid said minutes before the vote. “I believe this is the road to a recovery for our country. Let’s just trust Barack Obama.”

Minority Whip Jon Kyl (R-Ariz.) also voted against the disapproval resolution. He said he voted for the first TARP disbursement in October because the financial system was in such a state of peril.

“The same circumstances that called for the initial $350 billion pertain today,” Kyl said.

Kyl added that officials in the incoming administration had assured him they intended to dedicate the funds to shoring up financial markets, and not to “prop up failing companies” outside of the funds targeted to the auto industry by the Bush administration.

The auto loans have been particularly unpopular with Republican senators.

Newly sworn-in Sen. Roland Burris (D-Ill.) cast his first vote in favor of releasing the funds. Vice President-elect Biden, just ahead of his resignation from the Senate, cast the final Senate vote of his 35-year career to reject the resolution. Democratic leaders timed the vote before Biden’s resignation.

Crossing the aisle to support Democrats on the TARP resolution were GOP Sens. Lamar AlexanderAndrew (Lamar) Lamar AlexanderOvernight Health Care — Presented by Campaign for Accountability — House passes drug pricing bills amid ObamaCare row | Senate Republicans running away from Alabama abortion law | Ocasio-Cortez confronts CEO over K drug price tag Bipartisan senators unveil measure to end surprise medical bills Work on surprise medical bills goes into overdrive MORE (Tenn.), Judd Gregg (N.H.), Kyl, Richard Lugar (Ind.), Olympia Snowe (Maine) and George Voinovich (Ohio).

{mospagebreak}Crossing over to support Republicans were Democrats Evan Bayh (Ind.), Maria CantwellMaria Elaine CantwellDon't revive logging in national forests Top Finance Dem offers bill to help those repaying student loans save for retirement Facebook COO Sheryl Sandberg meets with senators on privacy MORE (Wash.), Byron Dorgan (N.D.), Russ Feingold (Wis.), Blanche Lincoln (Ark.), Ben Nelson (Neb.), Jeanne ShaheenCynthia (Jeanne) Jeanne ShaheenForeign Relations senators demand Iran briefing The Hill's Morning Report - Presented by Pass USMCA Coalition - After GOP infighting, Trump Jr. agrees to testify again Bipartisan senators seek sanctions on Russian pipeline work MORE (N.H.) and Ron WydenRonald (Ron) Lee WydenOregon man sentenced after threatening to chop off Dem senator's tongue House to vote on retirement bill next week Hillicon Valley: Trump signs order to protect US networks from Chinese tech | Huawei downplays order | Trump declines to join effort against online extremism | Facebook restricts livestreaming | FCC proposes new tool against robocalls MORE (Ore.). Independent Bernie SandersBernie SandersHere are the potential candidates still eyeing 2020 bids Sanders unveils education plan that would ban for-profit charter schools Warren policy ideas show signs of paying off MORE (Vt.), who caucuses with Democrats, also supported Republicans in voting against disbursing any more TARP money.

Absent from the vote were Sens. Sherrod BrownSherrod Campbell BrownLawmakers grapple with the future of America's workforce The Hill's Morning Report - Presented by Pass USMCA Coalition - Restrictive state abortion laws ignite fiery 2020 debate On The Money: Mnuchin signals officials won't release Trump tax returns | Trump to hold off on auto tariffs | WH nears deal with Mexico, Canada on metal tariffs | GOP fears trade war fallout for farmers | Warren, regulator spar over Wells Fargo MORE (D-Ohio), Edward Kennedy (D-Mass.) and Jim Bunning (R-Ky.). Kennedy paired with Sen. Orrin HatchOrrin Grant HatchTrump gambles in push for drug import proposal Biden's role in Anita Hill hearings defended by witness not allowed to testify 'Congress' worst tax idea ever'? Hardly. MORE (R-Utah), while Brown paired with Jon TesterJonathan (Jon) TesterGOP angst grows amid Trump trade war Overnight Defense — Presented by Huntington Ingalls Industries — Pentagon approves transfer of .5B to border wall | Dems blast move | House Dem pushes Pelosi to sue over Trump's Yemen veto Pentagon approves transfer of .5B to Trump border wall from Afghan forces, other accounts MORE (D-Mont.) — a process by which senators withhold their votes to cover for another’s absence in the final total.

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Senators who supported the first TARP disbursement in October but opposed the second include Bayh, Kit Bond (R-Mo.), Richard BurrRichard Mauze BurrOvernight Defense: Congressional leaders receive classified briefing on Iran | Trump on war: 'I hope not' | Key Republican calls threats credible | Warren plan targets corporate influence at Pentagon Key Republican 'convinced' Iran threats are credible Congressional leaders receive classified Iran briefing MORE (R-N.C.), Saxby ChamblissClarence (Saxby) Saxby ChamblissRepublicans say Democrats holding up disaster relief as 'Sandy payback' Ex-House Intel chair: Intel panel is wrong forum to investigate Trump's finances The Hill's Morning Report - Trump budget reignites border security fight MORE (R-Ga.), Tom CoburnThomas (Tom) Allen CoburnThe Hill's Morning Report — Presented by PhRMA — Worries grow about political violence as midterms approach President Trump’s war on federal waste American patients face too many hurdles in regard to health-care access MORE (R-Okla.), Susan CollinsSusan Margaret CollinsThe Hill's Morning Report — Presented by Pass USMCA Coalition — Trump: GOP has `clear contrast' with Dems on immigration Overnight Health Care — Presented by Campaign for Accountability — House passes drug pricing bills amid ObamaCare row | Senate Republicans running away from Alabama abortion law | Ocasio-Cortez confronts CEO over K drug price tag Colorado secretary of state bans employees from traveling to Alabama after abortion law MORE (R-Maine), Bob CorkerRobert (Bob) Phillips CorkerCorker: 'I just don't' see path to challenge Trump in 2020 Ex-GOP Sen. Corker: Trump primary would be 'good thing for our country' Pollster says Trump unlikely to face 'significant' primary challenge MORE (R-Tenn.), John CornynJohn CornynTrump's immigration push faces Capitol Hill buzzsaw The Hill's Morning Report - Presented by Pass USMCA Coalition - Restrictive state abortion laws ignite fiery 2020 debate Sinema, Gallagher fastest lawmakers in charity race MORE (R-Texas), John Ensign (R-Nev.), Lindsey GrahamLindsey Olin GrahamTrump: Anonymous news sources are 'bulls---' Trump: 'Good chance' Dems give immigration 'win' after Pelosi called White House plan 'dead on arrival' The Hill's Morning Report — Presented by Pass USMCA Coalition — Trump: GOP has `clear contrast' with Dems on immigration MORE (R-S.C.), Chuck GrassleyCharles (Chuck) Ernest GrassleyOvernight Defense: Trump rails against media coverage | Calls reporting on Iran tensions 'highly inaccurate' | GOP senator blocking Trump pick for Turkey ambassador | Defense bill markup next week Trump reaches deal to lift steel, aluminum tariffs on Mexico, Canada Top GOP senator blocking Trump's pick for Turkey ambassador MORE (R-Iowa), Kay Bailey Hutchison (R-Texas), Johnny IsaksonJohn (Johnny) Hardy IsaksonPence, McConnell eulogize Sen. Richard Lugar On The Money: GOP angst grows over Trump's trade war | Trump promises help for 'Patriot Farmers' | Markets rebound | CBO founding director Alice Rivlin dies | Senate to vote on disaster aid bill next week GOP angst grows amid Trump trade war MORE (R-Ga.), Lincoln, Mel Martinez (R-Fla.), McCain, McConnell, Lisa MurkowskiLisa Ann MurkowskiOvernight Health Care — Presented by Campaign for Accountability — House passes drug pricing bills amid ObamaCare row | Senate Republicans running away from Alabama abortion law | Ocasio-Cortez confronts CEO over K drug price tag Senate Republicans running away from Alabama abortion law Bipartisan senators unveil measure to end surprise medical bills MORE (R-Alaska), Ben Nelson, Arlen Specter (R-Pa.) and John ThuneJohn Randolph ThuneHillicon Valley: Trump takes flak for not joining anti-extremism pact | Phone carriers largely end sharing of location data | Huawei pushes back on ban | Florida lawmakers demand to learn counties hacked by Russians | Feds bust 0M cybercrime group Senate Commerce chair to renew push for regs on self-driving vehicles Hillicon Valley: Facebook co-founder calls for breaking up company | Facebook pushes back | Experts study 2020 candidates to offset 'deepfake' threat | FCC votes to block China Mobile | Groups, lawmakers accuse Amazon of violating children's privacy MORE (R-S.D.).

Changing their minds from opposing the first TARP disbursement in October but supporting the second on Thursday were Sens. Tim JohnsonTimothy (Tim) Peter JohnsonSeveral hurt when truck runs into minimum wage protesters in Michigan Senate GOP rejects Trump’s call to go big on gun legislation Court ruling could be game changer for Dems in Nevada MORE (D-S.D.), Mary LandrieuMary Loretta LandrieuDems wrestle over how to vote on ‘Green New Deal’ Lobbying world Former New Orleans mayor: It's not my 'intention' to run for president MORE (D-La.), Bill NelsonClarence (Bill) William NelsonRepublicans amp up attacks on Tlaib's Holocaust comments The muscle for digital payment Rubio says hackers penetrated Florida elections systems MORE (D-Fla.) and Debbie StabenowDeborah (Debbie) Ann StabenowDems want climate change, tax hikes in infrastructure deal Critics accuse EPA of weakening pollution rule for Pentagon Democratic proposals to overhaul health care: A 2020 primer MORE (D-Mich.).

Last October’s bailout was originally designed to give Treasury the financial power to buy up vast numbers of troubled assets, but as financial markets deteriorated sharply in the fall, the department abruptly shifted course.

Instead of troubled assets, Treasury officials allocated $250 billion to purchase equity stakes in banks, and then used the rest of the first half of the package to support a range of other institutions, including insurance firm AIG.

While Kyl voted for the bill, most Republicans rejected releasing the funds. Sen. Sam Brownback (R-Kan.) called TARP “a rather large slush fund,” while Sen. Jim DeMint (R-S.C.) told senators to support the resolution of disapproval to “slow down this avalanche of spending and debt.”

Thursday’s vote was a close call for Obama and his team, who had staked significant political capital on getting the money so the administration could act quickly to repair the economy by easing the flow of credit. Obama came to the Capitol on Tuesday to press his case personally for the money, and incoming Chief of Staff Rahm Emanuel and Obama economic aide Lawrence Summers followed on Wednesday for a Q-and-A with Senate Republicans.

In a letter to Reid on Thursday aimed at soothing opposition, the Obama administration pledged to devote up to $100 billion of the rest of the funds to reduce home foreclosures, and Summers also pledged that the new administration would take specific steps to improve accountability.

“No substantial new investments will be made under this program unless President-elect Obama has reviewed the recommendation and agreed that it should proceed,” Summers wrote Reid.

Summers said the foreclosure funds will add up to somewhere between $50 billion and $100 billion, in a “sweeping effort to address the foreclosure crisis.” The rest of the money would be used towards the financial markets specifically and not to support a broader range of investments in America’s corporate world, he said.

“The incoming Obama administration has no intention of using any funds to implement an industrial policy,” Summers wrote.