Skip to comments.Shelby: Bailout Just Codifies Ad Hoc Approach (More Cracks appearing in Bush/Democrat Bailout plan)
Posted on 09/23/2008 2:13:19 PM PDT by Maelstorm
During his opening statement at a hearing on Capitol Hill Tuesday, Republican Sen. Richard Shelby of Alabama expressed his displeasure with the government's massive financial bailout.
From Shelby's prepared remarks:
Unfortunately, the Treasury Department's latest proposal continues its ad hoc approach, but on a much grander scale. The plan contemplates the purchase of up to $700 billion in troubled mortgage-related assets from financial institutions. Treasury expects, but is not required, to purchase most assets through a type of reverse auction process. There are very few details in this legislation. In fact, Treasury officials admit that they will have to figure out the mechanics as they go along. Rather than establishing a comprehensive workable plan for resolving this crisis, I believe this legislation merely codifies Treasury's ad hoc approach...
My record is very clear on taxpayer funded bailouts. I have long opposed government bailouts for individuals and corporate America alike. As a Congressman, I voted against the loan guarantees for Chrysler in 1979. However, if the government is going to get into the bailout business, shouldn't we also be focusing our resources on average Americans, rather than sophisticated and well-compensated bankers? The Treasury's plan has little for those outside of the financial industry. It is aimed at rescuing the same financial institutions that created this crisis with their sloppy underwriting and reckless disregard for the risks they were creating, taking, or passing on to others. Wall Street bet that the government would rescue them if they got into trouble. It appears that bet may be the one that pays off.
Once again, what troubles me most is that we have been given no credible assurances that this plan will work. We could very well spend $700 billion and not resolve the crisis. Before I sign off on something of this magnitude, I want to know that we have exhausted all reasonable alternatives. I don't believe that can be done in a weekend. Unfortunately, the incredibly accelerated process for considering this bill means that Congress does not have time to determine if there are better alternatives to Treasury's plan. I am very concerned that the expressed need to pass something now may prevent us from devising a plan that actually works. Without question, our markets and financial institutions need serious attention. I do not believe, however, that we can solve this crisis by spending a massive amount of money on bad securities. It is time that the Administration and Congress do the hard work of devising, as quickly as possible, a comprehensive and workable plan for resolving this crisis, before we waste $700 billion of taxpayer money.
Paulson is a DEMOCRAT and his wife is a HUGE Democrat....I don’t TRUST him!!
If that doesn't chill you to your very marrow, nothing will.
As of Monday night, the Dems had written credit card debt relief into the bill.
That means you’ll have bought your neighbor’s Big Screen TV.
I thought they were supposed to refinance the mortgages in default so people would not loose thier homes?
They can refinance as much as they want but most of these people cant afford taxes and insurance their homes. Their local governments and school districts have made sure no one can afford it.
Well I thanked Senator Shelby. We should all be writing to all of our representatives.
A good start would be Barney Frank and Chris Dodd RESIGNING.
A free market and free market alone should determine the value of these mortgages.
Private money acts rationally over time.
Is there any link that documents all the crap pork dems are trying to stuff into this bailout sausage?
This is not a new thing. Pre-Hoover/FDR these things happened, even without government interference. They were called Panics and were follơwed by Hard Times for a couple of quarters and then recovery.
Like the current bailout proposal, after the Crash of 29 the government intervened massively and converted a couple of quarters of Hard Times into two decades of Depression.
The Carter depression, and it was just that but masked by inflation, was ended by Reagan ending the most egregious interventions and deregulating. It will happen again.
Unfortunately, with the level of government interference that has only increased since '29, there is little likelihood of a Reagan or an Eisenhower coming on the scene to finally do the right thing and little chance that such a one will be able to do the right thing if he desires to.
This "bailout" will prolong the pain and drive it deeper into the whole society and the classes of people being "helped" will mostly end up suffering worse than if the market were simply allowed to work.
The government needs to We need for the government to do the immediately cruel deed and pull out all government support and just get out of the way. Knives and anvils are falling and the government is pushing us all out to catch them with bare hands.
There is a political axiom that laws passed in haste are bad laws. There is an inordinate amount of haste in this reaction to the “crisis.” Because the measures are massive, the ultimate and even proximate harm will be massive and of long duration. This intervention will finally end the Reagan boom.
Keep those cards, letters, phone calls and emails going to congress that we don’t want a blank check bailout. We need some new faces in charge. Valueing these assets should be done by a market mechanism.
So now they want to add a bunch of poor credit risk student loans? Credit card securities? Neither of those belong anywhere near this subject. They are both unsecured loans that the banks and institutions made wide margins on..they can swallow their losses. If there is no longer a market for student loans..then the schools will just have to respond by reducing undergrad tuition.
I trust him totally. He will do what Democrats and other socialists do. Prosperity is not a value to such a one. Collective equality is.
A Tiger’s a Tiger.
Snakes might be a better analogy.
How come niether party is looking for an alternate. Possibly because the above makes too much sense
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