that is the right decision. it is one that the hon. lady should be behind. when colonel gaddafi is finally removed, is the prime minister confident that an interim government can be found to prevent the country from falling into anarchy? >> i would advise my hon. friend to ignore the voices opposite. there are just furious that he has liberated a long-held labor seat. he makes a very good point. [laughter] one of the things that we are doing, currently and in the coming days, is making contact with the opposition in been gauzy to make sure that we have good contacts with them so that we can help to bring a peaceful transition in libya. >> order. >> each week, the house of commons is in session, we air prime minister's questions live on c-span 2, wednesday at 7:00 a.m. eastern and again on sunday night on c-span. at c-span.org you can find past prime ministers questions. >> next, a congressional oversight hearing examines the impact of the troubled asset relief program known as tarp. then alabama gov. robert bentley delivers his state of the state message appeared at 11:00 p.m., "washington post"on' writer. >> thtarp has been a success. remarks came at the congressional tarp oversight panel public hearing which looked at the overall impact of the tarp program. this portion of that hearing is about 45 minutes. >> there is no question that our economy faces real challenges. let's take a moment at the start of today's hearing to imagine that those challenges could be far worse. they were far worse. let's imagine that the s&p 500, which has risen by nearly 20% last year, had instead fallen by 30% in the last month. let's imagine that our economy, which has added over a million jobs in the last year, had instead lost that many jobs in just two months. let's imagine that america's oldest and most highly regarded financial institutions were beginning to topple literally like dominoes. i think it is fair to describe this scenario as a dire. that is precisely the scenario that faced economy in late 2008, around the time that congress passed tarp into law. today, the panic of 2008 is a slowly fading memory. tarp played a role in turning the page on that grithe grim chapter. i believe that any hearing on the part should begin by recognizing its greatest success, in a moment of financial panic, it helped to pull our market back from the abyss. despite this accomplishment, the tarp remains deeply despised by the american public. most of the anger is understandable. it did much more for wall street than it did for everyday americans. it is only fair to note that some of the bun popularity is due to misunderstandings about its track record. -- about the unpopularity is due to misunderstandings about its tractor -- about its track record. only 33% believe that most of the money will be recovered. many of the greatest skeptics recall the frightening price tag first assisted with the program, $700 billion, the amount that the treasury requested and congress approved to bail out the financial system. what they do not know is that the congressional office estimates it will lose $25 billion. but maybe clear. $25 billion is a vast sum of money. yet it is far less than anyone expected the tarp to cross when it was initiated. the news is not all good. it has fallen far short to help homeowners stay in their homes. the panel estimates that it will prevent fewer than 8000. it is no wonder that many americans view the program as one executed for wall street ceo's rather than main street homeowners. the program has a far greater and more noxious cost, moral hazard. it is the lingering belief that america's biggest banks are too big to fail and that the rules apply to everyone else in america and not to them. this belief continues to distort our financial markets, advantaging the largest banks on wall street while disadvantaging every other bank in the country. the cost to moral hazard is not easily quantifiable, but israel and reprehensible. today's hearing will consist of three panels of distinguished witnesses. we are joined by timothy who manages all our programs for the department of treasury. i particularly hope you will share with us your lessons learned from more than two years of work on the tarp. if you created it today, what would you have done differently? what can our nation learned from this ugly experience and how can we prevent it from ever happening again? our second panel includes witnesses from fdic and the federal reserve. i hope these witnesses will help us placed tarp in its proper context. finally, we will be joined by four of this country's leading economists who will bring decades of experience and exceptional credentials. i look forward to hearing their expert views on the crisis and its enduring impact. all of our witnesses testimony will provide material support for the 30th and final oversight hearings. the report, which will be issued to congress and the public later this month. i would like to hear from my colleagues. >> thank you, senator kaufman. although the congressional budget office recently estimated that the necessity cost to tarp was only down to $25 billion, such metrics should not serve as a sole the termination of the success or failure of the program. we should remain mindful that the overall contribution to the rescue the u.s. economy was relatively modest when considered along with the multi-hundred billion dollar bailout of fannie mae and freddie mac. if it is particularly difficult to labor the tar or any other government-sponsored program aimed at financial stability and unqualified success when the unemployment rate hovers around 9%, the combined unemployment and other unemployment rate = 60% and millions of american families are struggling to escape foreclosure. it is of cold comfort to these families that be too big to fail financial institutions aided by the tar and other generous below-market rate government- sponsored programs are recording near-record earnings. to this day, the tarp carries a substantial stigma with a the residents of main street and it should come as little surprise. we noted in our oversight report that to the repayment of the tarp recipients is a misleading measure of the effectiveness of the program and should not serve as the standard by which the tarp is judged. the unlimited bailout of fannie mae and freddie mac buy treasury and the purchase of 1.1 and $25 trillion -- $1.125 trillion. in effect, the bailout of fannie mae and freddie mac prevented tarp recipients to monetize what they would have received and use the proceeds to pay that which was outstanding. costs such as this should be thoughtfully considered when evaluated need tarp. -- when evaluating the tarp. it is also clear that the success or failure of the tarp remains an open question. neither a favorable adjustment to the cbo subsidy rate nor the repayment of the top funds by some recipients tells the entire story. it is critical to note that all of the tarp play a meaningful role in the u.s. economy. its enduring legacy may have been to codify the implicit guarantee of the too-big-to- fail. the tar, in essence, reinforced the bubble bailout cycle as the government's preferred business cycle. along these lines, "the government's actions in rescuing a ig continues to have a poisonous effect on the marketplace by providing a complete rescue that called for no shared sacrifice among aig's creditors. the federal reserve and treasury fundamentally changed the relationship between the government and the country's most sophisticated financial players. the aig rescue demonstrated that treasury and the federal reserve would commit taxpayers to pay any price and bear any burden to prevent the collapse of america's largest financial institutions and to assure repayment to the creditors doing business with them. so long as this remains the worst effects of aig's rescue on the marketplace will bring your." -- will linger." in general 2011, on the report, the panel noted "treasuries now on course to recover the majority of the automotive investments within the next few years. but the impact of the actions will not reverberate for much longer. treasurys rescue suggested that any sufficiently large american corp., even if not a bank, may be considered too-big-to-fail, creating a risk that moral hazard will affect the economy far beyond the financial system. the government help of the sword the cost of gm's and chrysler's failure and put financial institutions risk. it is important to consider the reasons underlined in this distinct popularity and stigma associated with the tar. it helped rescue the united states economy from collapse and it should not have served as the basis for the public outrage and scorn expressed today. hundreds of often profited and ill-managed institutions and their shareholders and officers received taxpayer funded bailout as well as other subsidies from the treasury, the federal reserve, and the fdic on remarkably favorable terms. many officers of these institutions retained lucrative employment. the shareholders and must recipients were not wiped out. the public intuitively recognize that such policies were an anathema in a market economy where entrepreneurs and passing investors alike retain their business investment prospect -- profits without question but are expected to bear the full losses with transparency and accountability and without subsidy. main street quickly realize that the tarp was heavily tilted toward thin favor of wall stree. banks that refused to lend and the general sense that the residents were left on their own. thank you and i look forward to our discussion. >> good morning. this is the last hearing of the congressional oversight panel. i would like to begin by expressing my gratitude to harry reid and nancy pelosi for giving me this opportunity to serve my country. also like to express my profound gratitude to our chair and his predecessor, elizabeth warren, for their participation in this panel and my sincere gratitude to our staff for all they have done over the past two and half years to make our panel a success. finally, i would like to thank my fellow panel members. we have worked together as a team in a manner that is tragically rare in our national politics today. i am honored to have been a part of that. today, we hear from acting assistant secretary timothy math andmatthen. while i am grateful to all of our witnesses for joining us today, i want to note that we have come in many ways, benefited from the advice and assistance of secretary massive and prof. johnson and it is fitting that they are here with us today. i think it is appropriate for me to be clear what my final conclusions are about the top program. number one, i believe top, through the initial investments in the large banks and in security markets primarily was a substantial contributor to halting a financial park. it is irresponsible to say that our nation would have been better off if we had taken no action. number two, i believe and there is overwhelming evidence to support my position that, at the time of these initial investments, the public did not receive anything like full value for our money. however, over time, the management of these assets and the execution of further transactions by the team managing tarp became systematically fair to the taxpayer and they deserve a great deal of credit for that. no. 3, the paulson treasury department was not truthful with the public when it said that the program funds would only help the institutions. the geithner treasury department has compounded this lack of candor by refusing to admit that citigroup and bank of america were on the verge of collapse when they received additional tarp friends in november 2008 and january 2009 respectively. no. 4, the failure to replace bank management, to do a rigorous evaluation of the state of bank assets, and to restructure bank balances accordingly, it has left weaker banks and a damage of trust between the american public and our nation's elected leaders. no. 5, although more than half a million families have been helped by turks foreclosure prevention programs, it has been subordinated to the needs of the banks. the truth is that the continued mass home foreclosures is due to systemic risk and pressure. in 2008, this panel held its first hearing in court county, nevada. we did so to make the point that the american people would judge tarp not only will the bankers, but on the health of our communities. in december 2008, unemployment in southern nevada was 9.1%. today, it is 14.9%. in december 2008, 6.5% of all home mortgages in nevada were doing great. take, 7.6% are. the most recent statement states that "the economic recovery is continuing although at a rate that is insufficient to bring about a significant improvement in labor market conditions. growth in household spending picked up last year, but remains constrained by high unemployment, modest income growth, lower housing wealth, and tight credit. that is exactly the scenario that the majority of this panel warned in our 2009 report and would be the likely consequence of failing to restructure the major banks. although this panel is going out of business, the task of managing tarp's remaining programs of regulating the banks, of the nursing systemic risk goes on. the mass foreclosures, tragically, continue. but it is never too late to act, to make change. thank you. >> i would like to start by thanking the witnesses for appearing before the panel today. i realize that you have other responsibilities. i appreciate you taking time to help us with our oversight responsibilities. it seems appropriate to comment on the overall impact of tarp and the financial rescue in general. i was recently asked whether my assessment would be different if tarp had ended up costing $356 billion instead of the current estimate of $25 billion. it is one of the more creative questions i have gotten. i answer that any completed assessment of the success of tarp needed to take into account a number of factors, such as the role it played in preventing the financial collapse, the risk taxpayers were exposed to, the long run impact it will have on the market, and its effect on the likelihood of future financial crisis. while the actual cost of tarp is an important component, it is only one factor affecting one devaluation of the success or failure of tarp. so my answer to the reporter is, yes, i still could view it as a success even if the program had cost taxpayers $356 billion. the government's actions were circumscribed by the expectations of the market in the event of the financial crisis. it would bailout firms whose bankruptcy threatened to increase systemic risk. these expectations, of course, were based on past government bailout of large financial firms. in fact, as argued previously, these expectations affected the severity of the financial crisis since the market responded by encouraging firms to grow until they became too big to fail, thereby increasing the number and size of systemically risky firms in the economy and the amount of money needed to stem the financial crisis. also, once they detained two- big-to-fill status, there were given the incentive to -- two- big-to-fail status, they were given incentive to continue. the success or failure of top, in particular in the overall financial rescue, will hinge -- so far, it does not appear that we have taken the necessary steps to end to big to fail -- too-big-to-fail. the market has a clear understanding of which firms will receive support in the next financial crisis and which will not. then the government needs to start charging market-based fees to these firms or insurance provided to them through a substantially higher reserve requirements, which has been advocated by prof. meltzer and others, by requiring firms to have alternative reserves against systemically risky holdings, as has been proposed, by challenging terms in the bailout and turns along the lines offered by the president of the federal reserve of minneapolis, or to have to pay the cost of the insurance that is currently being paid for by the american taxpayers. only by ending the taxpayer- funded survival guarantee for large firms, both domestic and foreign, will we return basic market discipline to wall street and ensure that large financial firms face the same competitive pressures faced by firms operating on main street. in turn, this will ensure that future financial crises will be less severe and that the fixes to these crises will not involve putting trillions of taxpayer dollars at risk. since this is our last year, there are some people i would like to note and thank for their work. i would like to thank the panel staff and our executive director for their work. looking over the totality of the panel's report, one realizes that this work will become one of the definitive sources of information about the financial crisis. this is largely because the hard work, patience, and dedication of our staff. i would also like to thank my family panel member mark waters for becoming familiar with the issues facing the panel. he was always available when i needed someone to bounce ideas off of to help me formulate my ideas about tarp. i would like to thank senator, and for his leadership. his guidance was -- fosenator kaufman for his leadership. his guidance was essential. finally, i would like to offer a special thank you to the longest-serving panel members. richard has been part of 30 reports issued by the panel called damon has participated in 27. as someone who is exhausted after having participated in a mere 10, i can honestly say that i do not know how they have done it, reading over and offering comments of three drafts of each of these reports. based on my observations, richard and damon have performed these tasks while facing the important responsibility had to support the interest of the american taxpayers. as a taxpayer, i would like to say thank you. i would also like to conclude and thank the witnesses once again for joining us and helping us with our discussion today. >> thank you. >> when the financial crisis hit in fall 2008, we had a republican president and a democratic congress. this panel was created by that congress to help hold the administration accountable in implementing the top program. there was no shortage of ideological objections from the left and the right when tarp was passed and there are no fewer today. but the american public's concern has been far less ideological or partisan. rather, they have retained the pragmatic focus, asking the question "is the investment of our money serving the public well?" it would have been difficult for this panel to assist with answering that question if we, ourselves, were distracted from it. congress wisely placed both democrats and republicans on this panel to force us to be as pragmatic as the people we were appointed to serve. our efforts toward that goal over two years as the nation gained a new democratic president and then gained a new republican house of representatives remained the same. our five different perspectives and background could have led to more disagreement than agreement. ultimately, it could have been a failure to shed light and create accountability regarding the most complex financial issues of the day. but one of the things that i will personally take away from this experience of the last two years is a renewed optimism that people can still work together for the public good during increasingly partisan times. even in the beginning, when ideology was at a -- those who all had something important but something different to contribute, found ways to come together. elizabeth warren deserves great credit for her leadership in the early days of this panel. we have not been perfect, however, and our oversight was always finite. if someone asked me what