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Washington: Rescue of Wall Steet in limbo
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| Zach Wamp | |
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| Lincoln Davis | |
WASHINGTON — As President Bush and the two major presidential candidates hashed out a Wall Street rescue plan Thursday, Sen. Bob Corker, R-Tenn., said he and other key lawmakers have developed a proposal with greater oversight than the White House’s plan.
Senate Banking Committee Chairman Sen. Chris Dodd., D-Conn., center, speaks during a news conference with, from left, Sen. Bob Corker, R-Tenn., Sen. Charles Schumer, D-N.Y., Sen. Robert Bennett, R-Utah, Sen. Judd Gregg, R-N.H., and Sen. Jack Reed, D-R.I., following a meeting on the market turmoil on Capitol Hill in Washington, Thursday, Sept. 25, 2008. (AP Photo/Susan Walsh)
Sen. Corker, who was among a handful of lawmakers involved in a three-hour bipartisan negotiation session between both houses of Congress, said their “agreement in principle” also would include restrictions on executive compensation.
“I’m hopeful that it can be approved before the markets open on Monday,” said Sen. Corker, a member of the Senate Banking Committee. “We stayed very focused, and we ironed out the principles that do protect taxpayers.”
But though the lawmakers claimed consensus about noon Thursday on their urgent multibillion-dollar plan to calm the financial markets, other members of Congress say they have not signed off on any deal, The Associated Press reported.
According to the agreement, Congress would release half of Treasury Secretary Hank Paulson’s requested $700 billion to purchase impaired debt. The other half could be blocked by Congress if it is unhappy with how the program is unfolding.
Secretary Paulson would be required to set standards on “excessive or inappropriate” executive compensation for participating firms and to apply any profits from the program to reduce the national debt, the agreement states.
An oversight board and an independent Inspector General would be established to monitor the program, according to the agreement.
Secretary Paulson has objected to many of the provisions in the agreement, saying he needs broad latitude to execute the debt purchases.
Both of Congress’ Republican leaders, Rep. John Boehner of Ohio and Sen. Mitch McConnell of Kentucky, also denied there was any deal, according to AP. Many Capitol Hill conservatives have balked at the huge price tag of the proposal and the heavy hand of government that it would place on private markets, AP reported.
BAILOUT ELEMENTS
* Authorize $700 billion for the government to purchase troubled assets and buy equity in distressed financial firms.
* Phase in the money for buying troubled assets, with $250 billion available immediately, $100 billion to be released if the Treasury secretary certifies it is needed, and the last $350 billion available with another certification, but subject to a congressional vote to block it.
* Require the Treasury Department to make rules to prevent excessive compensation for executives whose companies benefit from the rescue.
* Establish a strong oversight board with authority to halt the program, a special investigator general to monitor it and regular government audits.
* Require the government to renegotiate mortgages it acquires under the program with the aim of helping borrowers keep their homes.
Source: The Associated Press
After a meeting at the White House about the crisis, presidential candidate Sen. Barack Obama, D-Ill., said Congress needs to do more work to reach a deal to address the financial crisis, according to The Associated Press.
His opponent, Sen. John McCain, R-Ariz., attended the same meeting and said some in Congress have “legitimate concerns” about the big price tag for taxpayers, but those critics also are aware of the crisis situation the country faces, AP reported.
Sen. McCain said he is hopeful an agreement will be reached so he can attend today’s presidential debate in Mississippi, according to AP. The two candidates have sparred over whether to cancel the debate to address the credit crisis.
Sen. Richard Shelby of Alabama, the top Republican on the Senate Banking Committee, emerged from the White House meeting to say the announced agreement “is obviously no agreement.”
Washington correspondent Herman Wang and The Associated Press contributed to this report.
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Comments
Seems to me the only "crisis" is not on Main Street but on Wall Street...which will recover just fine on its own -- minus the grasshoppers.
Just what we need in Nov to deepen the problem -- another far-left president-in-training meddling in our economy, as if our Congress is not bad enough.
Shades of FDR, the man who extended and deepened the Great Depression with his idiotic "economic recovery" programs.
0 of 0 people found this comment useful.
Rolando, what world are you living in? Washington Mutual just failed. If the bleeding isn't stopped, Main Street Americans aren't going to have any money. My retirement is rolled into a 401k, mutual funds and savings. How do you think those have fared this week?
If credit continues to tighten, people won't be able to get loans for homes, automobiles or college. I'm not referring to irresponsible borrowers; I'm talking about guys like you and I who work hard, save money and behave responsibly.
John McCain is doing little to help move White House negotiations along - inserting politics into the process every step of the way (alongside House Republicans). Barack Obama maybe be a liberal, but at least he's working to help you right now.
NO ONE likes this deal, but sometimes you have to make the best of the hand that's dealt to you. If anything, local papers like the Times Free Press could do a better job of explaining how the problems on Wall Street will in fact threaten Main Street Americans' financial security.
1 of 1 people found this comment useful.
Davidm, I have no 401k, no mutual fund, and very little cash savings. I live hand to mouth on the pittance from Social Security after 50-odd years paying into it. It doesn't go far. My emergency nest egg is in gold; it was at $870 per troy ounce a couple days ago...up from $85 or so when I had the the foresight to buy it [once we were "permitted" to]. Gold is sure; its value does not depend on banks, brokers, paper money...nothing.
The very last thing we need now is for Congress and the Prez -- however he is -- to throw the SS system out the window in favor of protecting irresponsible banking practices. You can bet your last dollar they will do exactly that, too...it is Congress, after all.
You must be aware of how easy it has been to get credit; I get offers every day in the mail -- offers for less than 3 or 4 percent although today's was just under 6. It is still easily available -- for a price, of course...a hidden one. All one needs is a credit rating of 800 or so.
In any case, all those credit risks are coming home to roost. Unfortunately, there are winners and losers.
There will always be money available from banks, Credit Unions, etc for those who can repay it; and therein lies the root of our current financial crisis -- too much easy credit at below-prime rates.
Cash deposits are insured regardless of what happens to banks -- unless the FDIC folds, of course...but not saving IT would be political suicide. Who cares if a monster, conglomerate, Holding Company owned bank/broker or three fails due to poor business practices? Darned if I can see rewarding business executives and owners -- including stockholders -- for allowing that kind of underhanded dealing.
"Money changers" and usurers will always be with us.
In closing, it makes no difference who gets elected [well, it does but that's another story]; we are going to take it in the shorts, regardless. BTW, if you think Obama is working for bible-clinging flyover country folks, you have been drinking too much kool-aid; the man is for only himself and his cronies...
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