WASHINGTON — Under heavy pressure to get Americans back to work, President Barack Obama on Monday suggested using a suddenly available pot of money left over from the government's bank bailout to help create more jobs.
Obama, who will address the subject in a speech today, has been struggling to trim the nation's painfully high unemployment rate, which is at 10 percent — just below a quarter-century high.
He said there may be "selective approaches" for tapping into the money that was to go for propping up seriously ailing financial institutions. The administration and its allies on Capitol Hill would have to get around a provision of the 2008 bailout legislation that requires money that is paid back by banks or left over to be used exclusively for reducing the federal deficit.
The administration now estimates that the Troubled Asset Relief Program, or TARP, will cost about $200 billion less than the $341 billion the White House estimated in August.
The lower estimate reflects faster repayments by big banks and less spending on some of the rescue programs as the financial sector recovered from its free-fall more quickly than anticipated.
"TARP has turned out to be much cheaper than we had expected, although not cheap," Obama told reporters at the White House. "It means that some of that money can be devoted to deficit reduction. And the question is: Are there selective approaches that are consistent with the original goals of TARP — for example, making sure that small businesses are still getting lending — that would be appropriate in accelerating job growth?"
It was the clearest signal yet that the White House might be planning to argue that helping unlock credit for small businesses is in line with the original goals of the bank bailout bill and thus a valid expenditure of federal money — with more job creation a by-product.
While the TARP bailout was intended to calm markets, it has become for many people a symbol of a supposed government bias for Wall Street at the expense of Main Street. It has contributed to a widespread anti-Washington mood that is troubling to incumbents of both parties.
Many of the nation's largest Wall Street institutions have roared back to health with the government's helping hand, even as the rest of the economy continues to suffer and shed jobs.
Some congressional Democrats are looking at redirecting up to $70 billion from the bailout windfall for job-related and other purposes.