Mayors, governors call for more federal funds

The nation's mayors and governors are prodding Congress to jump-start the economy by increasing food stamp payments, extending unemployment insurance and boosting funding for Medicaid.

The groups said in separate announcements Thursday that the best way to revive the economy is to increase spending at the local level.

Governors are promoting a federal spending plan that could total $126 billion in added dollars for Medicaid, highway construction and job training.

The National League of Cities recommends extending unemployment insurance benefits by seven weeks or an additional 13 weeks in states with high unemployment rates.

Banker says bailout money not misused

WASHINGTON — Some of the nation's largest banks sharing in the $700 billion government bailout of the financial industry tried to assure lawmakers Thursday they are using the money to make more loans and help financially strapped homeowners avoid foreclosure.

Barry L. Zubrow, chief risk officer with JP Morgan Chase & Co., told the Senate Banking Committee that a portion of the $25 billion capital infusion it received from the Treasury was being deployed to assist with rewriting residential mortgages for up to 400,000 families.

Mr. Zubrow and executives with Goldman Sachs Group Inc., Bank of America Corp. and Wells Fargo & Co. told the committee that none of the $75 billion they have received collectively is being used to pay salaries or bonuses.

Bank of America gets subpoena over bonuses

NEW YORK — New York Attorney General Andrew Cuomo issued a subpoena to Bank of America Corp. this week demanding a list of every executive who received a bonus of more than $250,000 over the past two years. The subpoena marked an escalation of Mr. Cuomo's investigation of the bonuses paid out to banking executives in the run-up to the meltdown this fall.

A person familiar with the investigation said Mr. Cuomo's office sent the subpoena after being disappointed with the initial response to a letter asking for similar information.