Now that the Senate has confirmed Neil Barofsky as the Special Inspector General who will oversee the expenditure of the $700 billion bailout, the Project On Government Oversight (POGO) calls on both the Senate and the House to approve a new bill that would update and strengthen the terms of the original bill that created the Troubled Asset Relief Program, or TARP.
The new bill was introduced by Sens. Claire McCaskill (D-MO) and Chuck Grassley (R-IA), and is called the Special Inspector General for the Troubled Asset Relief Program Act of 2008. The "SIGTARP bill" is necessary because the bailout has evolved into a different program from October 3, when the legislation originally passed. The original law (the Emergency Economic Stabilization Act of 2008 or the EESA) did not make clear that the Special IG has the authority to monitor all of TARP's financial activities, including foreclosure mitigation efforts and conflict-of-interest requirements. Further, the law did not provide the Special IG with the authority to hire staff quickly and ramp up his office as soon as possible.
"With roughly half of the $700 billion out the door of the Treasury building already, POGO believes it is urgent that this bill pass both Houses of Congress and be signed into law immediately. Special IG Barofsky's authority to oversee, audit, and investigate the uses of these vast amounts of the taxpayers' funds needs to be made crystal clear as soon as possible," said Beverley Lumpkin, POGO Investigator.
In addition to making clear that Special IG Barofsky has the authority to look into all aspects of the relief program, the SIGTARP bill also provides him with temporary hiring authority that allows him to waive civil service rules for six months. This is the same special authority granted to the Special IG for Iraq Reconstruction. After six months, Special IG Barofsky will then follow the usual civil service rules for any additional hires.
The bill will also require the Treasury Secretary to explain to Congress any failure to implement recommendations made by the Special IG, and requires that the funds needed for the Special IG's office be made available to him within seven days of his confirmation. The bill also directs the Special IG to coordinate with other affected federal IGs to avoid duplication and ensure effective oversight, and to report to the Congress on July 1, 2009, with an analysis of the uses made thus far with TARP funds. That report will be made public and posted on the internet within 24 hours of its release.
The bill was co-sponsored by Sens. Susan Collins (R-ME), Joe Lieberman (I-CT), Olympia Snowe (R-ME), Chris Dodd (D-CT), Jim Bunning (R-KY), Norm Coleman (R-MN), and Charles Schumer (D-NY).