Treasury Secretary Henry Paulson and Fed Chairman Ben Bernanke are on the Hill trying to sell their $700 billion bailout to lawmakers. Yesterday Secretary Paulson and Chairman Bernanke testified before Congress that the bailout must be passed quickly and cleanly in order to prevent further economic crisis. Chairman Bernanke warned that inaction by Congress would lead credit markets to continue to seize up, meaning lost jobs, higher unemployment and more foreclosures.
While most parties freely recognize that these are unprecedented times and that the economy is on the brink, not all are willing to accept the Bush Administration’s bailout proposal. Many commentators have labeled the plan a “knee-jerk” reaction being pushed using scare tactics. Most in Congress want at least more time to evaluate the plan. That certainly should be a reasonable expectation when one is talking for taxpayer money at these levels.
It is critically important that the plan be designed and implemented to succeed with its purpose-to assist in the recovery of the US economy and turn the current tide. If the taxpayers are going to foot the bill for the mistakes and greed of Wall Street, they should be confident that whatever proposal is ultimately put in motion will have the desired effect. This plan must benefit those on Main Street and not simply bailout the very parties responsible for the mess in the first place.
Wall Street and its executives made hundreds of millions of dollars by creating the exotic mortgage-related securities cited as the cause of the current financial crisis. It is understandable that many in this country are suspicious of a bailout that in any way rewards the greed and bad behavior that created the mess we are in. Unfortunately the plan as proposed does not seem to adequately address the concerns of either the common citizen or Congress.
This plan must be properly vetted and Congress must be allowed to address its concerns before the taxpayers give the Treasury a $700 billion blank check.