Tarp Case

In late 2008 and early 2009, our nation faced one of the worst financial and economic crises in its history. A growing financial panic threatened the health of our entire economy. Businesses were shedding hundreds of thousands of jobs per month. Ordinary Americans were questioning the safety of their savings in banks. Access to credit for families and businesses was drying up. Confidence in the basic soundness of our financial system had been severely shaken.

The Troubled Asset Relief Program (TARP) played a critical role in breaking the back of the financial crisis and laying a foundation for future growth. It included a comprehensive set of measures to recapitalize the financial system, restart the credit markets, restore confidence, and lower borrowing costs for businesses and families.

The U.S. financial system is much stronger today, and is in a much stronger position to support economic recovery, because of TARP. We have already made substantial progress in recovering our investments in banks, ending emergency government programs, and exiting from the financial system. Firms that received assistance through TARP have repaid taxpayers more quickly than anyone had originally anticipated. As a result, the overall cost of the program is expected to be less than $50 billion - a fraction of the $700 billion originally authorized.

Today, because of TARP and other critical measures to combat the fallout from the financial crisis, including the American Reinvestment and Recovery Act and targeted support from the Federal Reserve, our economy is healing. Businesses are adding jobs again. Private investment is returning.

TARP, of course, was not the answer to all of America's challenges, and we have many still ahead. The economy is growing, but at a slower pace than we need. While it will take time to fully repair the damage of the severe and searing recession that President Obama inherited, it is clear that we are on the path to recovery. And that TARP played an essential role in making that recovery possible.