Bush agrees to Obama bailout entreaty

WASHINGTON — Acting at Barack Obama's behest, President George W. Bush on Monday asked Congress for the final $350 billion in the financial bailout fund, effectively ceding economic reins to the president-elect in an extraordinary display of transition teamwork.

Obama also sharply criticized Bush's handling of the money and promised radical changes.

Bush's move sets the stage for Obama to get swift access to the $350 billion and the opportunity to overhaul the much-criticized rescue package after taking office next Tuesday. Obama said that it would be "irresponsible ... to enter into the administration without any potential ammunition should there be some sort of emergency or weakening of the financial system."

Congress, where the use of the money has met stiff bipartisan skepticism, has 15 days to vote to reject the request. Senate Majority Leader Harry Reid, D-Nev., was considering holding a vote on a resolution of disapproval as early as Thursday in hopes it would be defeated, thus making the funds available about a week after Obama inherits one of the worst financial crises in U.S. history.

"It is clear that the financial system, although improved from where it was in September, is still frail," Obama said, a few hours after seeking Bush's help in requesting the money.

If Congress goes along, Obama would have a huge cache of bailout money at his disposal — and much more to come in the approximately $800 billion economic stimulus bill that Democratic congressional leaders promise to finish by mid-February. Congress also is racing to have ready for Obama a $35 billion health insurance program for children.

Obama acted quickly, sending prompt reassurances to congressional leaders that the money would aim to help free credit for small businesses and consumers and reduce the rising number of foreclosures. Separately, Larry Summers, Obama's choice for National Economic Council director, said the new president intends to also impose tougher restrictions and oversight on how the money is spent.

"Many of us have been disappointed with the absence of clarity, the lack of transparency, the failure to track how the money's been spent and the failure to take bold action," Obama said.

In a letter to congressional leaders, Summers said an Obama administration would "launch sweeping efforts to address the foreclosure crisis" and, in a bow to Republican critics of the plan, said it would seek to replace the government money with "private investments as quickly as possible."