This vote was on an amendment by Jack Reed, D-R.I., that would allow for future legislation that would stipulate that the remaining funds in the Troubled Asset Relief Program (TARP, the law authorizing the Treasury Department to buy up to $700 billion in “toxic” mortgage assets) would be used to help save homes and small businesses, bolster the bond market, expand credit, and strengthen government oversight of the program.  The amendment was offered to the budget resolution that serves as the blueprint for Congress’ budget priorities in fiscal 2010.  The budget resolution sets overall spending targets for the Appropriations committees and outlines other budget rules.

Reed said his amendment is intended as a counterpoint to another amendment offered by David Vitter, R-La.

“My amendment would  .. . focus the remaining resources in the TARP fund on supporting small businesses, saving homeowners from foreclosure, helping the bond market, and making credit more widely available. It would also strengthen the oversight entities, the Special Inspector General, the Congressional Oversight Panel, and the Government Accountability Office,” Reed said.

Vitter said his amendment would return TARP funding that has not already been committed, except for $100 billion set aside to buy toxic assets.

“That is exactly what TARP was supposed to be about.  But it ends everything else and invites the Obama administration to come back to us regarding other programs. The Reed amendment reaffirms TARP as it has been executed. So if you like everything that has been done under TARP and how it has been done, that model and program changing every other week, vote for the Reed amendment and reaffirm TARP as it is. If you think a change and focus needs to be brought to TARP, vote for the Vitter amendment, which is next,” Vitter said.

Reed’s amendment would have the effect of insulating any such future legislation against parliamentary maneuvers that take aim at legislation that increases the deficit, which violates the Senate’s rules.

Reed’s amendment was adopted by a vote of 56-42.  All but two Democrats present voted for the amendment.  All but one Republican present voted against the amendment.  The end result is that the measure went forward with language that would allow for any future legislation that reaffirms that remaining TARP funding be used to rescue homes and small businesses, bolster the bond market, expand credit and strengthen government TARP oversight.