Treasury Department officials are laying the groundwork for seeking the second half of the $700 billion financial rescue package from Congress and have approached President-elect Barack Obama's transition team in an effort to gain access to the funds, sources familiar with the matter said.
With lawmakers on both sides of the aisle expressing heated opposition to such a request, Treasury officials have come to realize that they need the president-elect's help to obtain the rescue money, the sources said.
The Treasury aired the possibility of seeking the second half of the funds with transition team officials, who said they would attend a meeting with lawmakers and the Bush administration if the department pulled one together.
Of the first $350 billion in rescue money provided by Congress, the Treasury has only $15 billion left, which may not be enough to save a major financial institution if it collapses. Just weeks ago, the Treasury committed to spending $25 billion in rescue money to prop up Citigroup; it had already provided the firm with a $25 billion infusion.
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