Obama Wants To Chance Financial Rescue Spending

By: Associated Press
By: Associated Press

President-elect Barack Obama says he plans to make a fundamental change in the way the $700 billion financial rescue fund is spent.

Obama has asked President George W. Bush to submit a request to Congress to release the second half of the money, and Bush agreed to do so.

The current administration has used the fund to inject capital into banks and to bail out ailing financial companies considered too big to fail. A small portion has gone to General Motors and Chrysler.

Speaking to reporters after a meeting with Mexico's president, Obama said some of the money should be spent on helping people avoid foreclosure and some should help small businesses. He also said he's been disappointed by the "lack of clarity" in how the first half has been spent.

Obama says the financial system is in better shape than it was in September, but "is still frail."

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