Wendy Sherman: “The bill is good as far as it goes, but before Congress thinks that we're done with the TARP program, we ought to be…”

“The bill is good as far as it goes, but before Congress thinks that we're done with the TARP program, we ought to be considering legislation to make it stronger and to provide additional limits. First, and most important, we need to prohibit those companies that receive funds under this program from then paying dividends to their existing common shareholders or using their money to go buy the shares held by their existing shareholders. Why are we putting capital in if the company is then taking the capital out, and giving it to its existing shareholders? That needs to be prohibited by statute. At a minimum, I hope we get an unequivocal letter from the incoming administration that they will prevent such transfers by regulation, and through other means. Second, we need to make sure that if assets are purchased from the banks that were buying bad bonds, that such bonds were owned by American entities, including those with foreign parents, and that these bonds were owned by American entities on September 20, 2008, which is when the whole dam broke. What we don't want to do is see these monies go to buy bad bonds that were bad investments made in Shanghai and Riyadh and London. Third, this bill under consideration, and the TARP bill, allows for Million-Dollar-a-Month salaries. We cannot go to the American people and say we have limited executive compensation except for the most common element of executive compensation, salaries.”