by Mark Silva
He has gone on national television, he has delivered statements from the White House -- one while seated between the Republican and Democratic nominees for the presidency in the West Wing this week -- and now President Bush is on the radio selling a $700-billion bailout for banks and other financial institutions which he insisted this week is necessary to avert "financial panic'' and a "long and painful recession.''
As congressional leaders negotiate into the weekend on a plan that they hope to produce before the markets open Monday, the president insists that this rescue is not about Wall Street, but rather about Main Street. All the toxic mortgage debt "clogging'' banks and preventing them from lending money could lead to a credit freeze at every level, the administration warns: Home loans, car loans, student loans and credit cards.
"I know many of you listening this morning are frustrated with the situation,'' the president said on the radio today. "You make sacrifices every day to meet your mortgage payments and keep up with your bills. When the government asks you to pay for mistakes on Wall Street, it does not seem fair. And I understand that.
"And if it were possible to let every irresponsible firm on Wall Street fail without affecting you and your family, I would do it. But that is not possible. The failure of the financial system would mean financial hardship for many of you.
"The rescue effort we're negotiating is not aimed at Wall Street -- it is aimed at your street.,'' the president said. "And there is now widespread agreement on the major principles. We must free up the flow of credit to consumers and businesses by reducing the risk posed by troubled assets. We must ensure that taxpayers are protected, that failed executives do not receive a windfall from your tax dollars, and that there is a bipartisan board to oversee these efforts. ''
That agreement, however, is largely among members of the Democratic leadership of the Congress and the Bush administration. And Democrats are calling on Bush's own party -- the House Republicans in particular -- to get in line with an agreement that can be presented as bipartisan. They're going to need a lot of votes to pass this one and then explain why they have committed the federal government to such a bailout..
This is the text of the president's radio address:
"Good morning. This is an extraordinary period for America's economy. Many Americans are anxious about their finances and their future. On Wednesday, I spoke to the nation, and thanked Congress for working with my administration to address the instability in our financial system. On Thursday, I hosted Senator McCain, Senator Obama, and congressional leaders from both parties at the White House to discuss the urgency of passing a bipartisan rescue package for our economy.
The problems in our economy are extremely complex, but at their core is uncertainty over "mortgage-backed securities." Many of these financial assets relate to home mortgages that have lost value during the housing decline. In turn, the banks holding these assets have restricted credit, and businesses and consumers have found it more difficult to obtain affordable loans. As a result, our entire economy is in danger. So I proposed that the Federal government reduce the risk posed by these troubled assets, and supply urgently needed money to help banks and other financial institutions avoid collapse and resume lending.
I know many of you listening this morning are frustrated with the situation. You make sacrifices every day to meet your mortgage payments and keep up with your bills. When the government asks you to pay for mistakes on Wall Street, it does not seem fair. And I understand that. And if it were possible to let every irresponsible firm on Wall Street fail without affecting you and your family, I would do it. But that is not possible. The failure of the financial system would mean financial hardship for many of you.
The failure of the financial system would cause banks to stop lending money to one another and to businesses and consumers. That would make it harder for you to take out a loan or borrow money to expand a business. The result would be less economic growth and more American jobs lost. And that would put our economy on the path toward a deep and painful recession.
The rescue effort we're negotiating is not aimed at Wall Street -- it is aimed at your street. And there is now widespread agreement on the major principles. We must free up the flow of credit to consumers and businesses by reducing the risk posed by troubled assets. We must ensure that taxpayers are protected, that failed executives do not receive a windfall from your tax dollars, and that there is a bipartisan board to oversee these efforts.
Under the proposal my administration sent to Congress, the government would spend up to $700 billion to buy troubled assets from banks and other financial institutions. I know many Americans understand the urgency of this action, but are concerned about such a high price tag. Well, let me address this directly:
The final cost of this plan will be far less than $700 billion. And here's why: As fear and uncertainty have gripped the market for mortgage-related assets, their price has dropped sharply. Yet many of these assets still have significant underlying value, because the vast majority of people will eventually pay off their mortgages. In other words, many of the assets the government would buy are likely to go up in price over time. This means that the government will be able to recoup much, if not all, of the original expenditure.
Members of Congress from both sides of the aisle have contributed constructive proposals that have improved this plan. I appreciate the efforts of House and Senate Democratic and Republican leaders to bring a spirit of bipartisan cooperation to these discussions. Our Nation's economic well-being is an issue that transcends partisanship. Republicans and Democrats must continue to address it together. And I am confident that we will pass a bill to protect the financial security of every American very soon.
Thank you for listening.
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Comments
Interesting how they are doing all of this in a closed door fashion. We the people will have to wait and see the garbage attached to this bill. As always, I am sure there will be garbage attached to this. At least the debate went off as planned and we are starting to head into the home stretch.
http://www.boppoll.com
A great way to start a stress free day!!
Posted by: Me thinks the Ship has sunk! | September 27, 2008 11:36 AM
If you want to see what Palin thinks of the bailout.....go to you tube and type in Palin on bailout. Whatch the Curic interview on the part about the bailout......she hasn't got a clue. It is darn right scary. She thinks it has to do with healthcare for crying out loud.
Posted by: bill r. | September 27, 2008 11:42 AM
The majority of callers on Washington Journal this morning don't want any part of this bailout. Many feel the government would do better to give each household part of the money and they all could pay-down their mortgages, pay for college and their medical bills. People do not feel that they should pay for someone else's bad judgement especially when the people who made the bad decisions have more money than the average American to begin with.
Posted by: lochnessmonster | September 27, 2008 12:08 PM
For 8 years, bush has said his supply side, trickle down economics benefits main street.
It clearly does NOT.
This would be the ultimate give away to the richest, largest, most corrupt bush cronies EVER.
The only way to ACTUALLY benefit main street, is to do what FDR did in the 1930s the last time that republicans messed up the economy and gave us the great depression. we have to get the cronies out of the picture, and negotiate directly with homeowners, giving them mortgage deals they can afford, and maybe in 20-30 years, we can be out of this republican mess.
Posted by: Dave Kliman | September 27, 2008 12:32 PM
Rush Limbaugh let it be known that Dems in Congress have added 20% of some sum of this Bailout package money to go to ACORN. I KID YOU NOT !
DOES THAT TELL ANY OF US OUT HERE THAT THERE WILL BE A SOLUTION or THAT THERE WILL BE 700b of GOOD MONEY CHASING AFTER MORE OF THE SAME BAD THAT GOT US HERE.
We all know that Carter created the CRA because of grass roots efforts pushing for it while the banks were ENTIRELY AGAINST GIVING OUT LOANS TO THOSE THAT DON'T EVEN QUALIFY FROM THE START... all but one banker in the ENTIRE UNITED STATES CAME FORWARD TO SUPPORT THIS IDEA MAKING BANKS GIVE LOANS TO THOSE WHO DON'T QUALIFY> a Southside Chicago banker.
This same banker got together with Bill Clinton in 1995 and they strengthened the rules on CRA to concentrate regulators to go after banks HARDER to force banks to loan to unqualified in MUCH GREATER NUMBERS. It put CRA on STEROIDS.
The ACORN group came about as results of the grassroots efforts that supported the CRA . ACORN was rewarded with mofia like power to bully the community banks into these bad loans by threatening to state that the banks were RACIST if they didn't go along with all types of bad loans. They strong armed banks to get what they wanted regardless of peoples ability to afford them. Acorn then bullied banks to give them large amounts of donations. Banks had no choice but to put together loans with some with no credit, some on welfare, no money, at 3% adjustable rates.
House prices were FALSELY INFLATED because there were THAT MANY OF THESE BAD LOANS OUT THERE, many even given to illegal immigrants. Foreign markets were in deep with thhese insured poor loans that were all bundled together.
Once the market changed the interest rates went up to over 5% and none of these people could afford their homes or other loans. Gas prices going up higher than ever in history didn't help them afford them any easier.
Obama's work with ACORN and it's associated Midwest Academy ranged from training and fundraising to legal representation and promoting their work. Obama has given monies and helped keep ACORN and it's associated off springs in funding. His campaign recently gave $800,000 to them for a service that they said they didn't provide. Acorn has agreed to put large sum of money towards voter registration (they've been charged with fraud in several cases around the U.S.).
My friend just went to down town Chicago and saw all these homeless men all over the city wearing Obama t-shirts that have his photo on one side and some writing about how he will pull the black man out of poverty.
Posted by: NO BAILOUT FOR ACORN AND CONGRESS WHO SUPPORTS THEM!!!!!!!!!!!!! | September 27, 2008 12:40 PM
NO Bailout -- yes, let's listen to Rush Limbaugh's words as if they were gospel. He's not biased in any way, is he? Heaven forbid any of the bailout would go to groups that could actually HELP the taxpayer, instead of just the greedy Wall Street execs and predatory lenders who created this mess to begin with.
There is a provision for ACORN to INDIRECTLY receive a percentage of any PROFIT, but ONLY if there is profit. Number 2.1 below -- ACORN falls under the Housing Trust Fund.
TRANSFER OF A PERCENTAGE OF PROFITS.
1. DEPOSITS.Not less than 20 percent of any profit realized on the sale of each troubled asset purchased under this Act shall be deposited as provided in paragraph (2).
2. USE OF DEPOSITS.Of the amount referred to in paragraph (1)
1. 65 percent shall be deposited into the Housing Trust Fund established under section 1338 of the Federal Housing Enterprises Regulatory Reform Act of 1992 (12 U.S.C. 4568); and
2. 35 percent shall be deposited into the Capital Magnet Fund established under section 1339 of that Act (12 U.S.C. 4569).
Posted by: Milw-Town | September 27, 2008 1:34 PM
Posted by: NO BAILOUT FOR ACORN AND CONGRESS WHO SUPPORTS THEM!!!!!!!!!!!!! | September 27, 2008 12:40 PM
Here we go again with the simple minded trying to blame minorities for all their problems. This is taken from the Federal Reserve website. Please notice the section on risky loans. You must have been one of those guys who always blamed the teacher for your failure...right?
The Community Reinvestment Act is intended to encourage depository institutions to help meet the credit needs of the communities in which they operate, including low- and moderate-income neighborhoods, consistent with safe and sound operations. It was enacted by the Congress in 1977 (12 U.S.C. 2901) and is implemented by Regulation BB (12 CFR 228). The regulation was substantially revised in May 1995, and was most recently amended in August 2005.
Evaluation of CRA Performance
The CRA requires that each depository institution's record in helping meet the credit needs of its entire community be evaluated periodically. That record is taken into account in considering an institution's application for deposit facilities.
Neither the CRA nor its implementing regulation gives specific criteria for rating the performance of depository institutions. Rather, the law indicates that the evaluation process should accommodate an institution's individual circumstances. Nor does the law require institutions to make high-risk loans that jeopardize their safety. To the contrary, the law makes it clear that an institution's CRA activities should be undertaken in a safe and sound manner.
Maybe instead of looking for a scapegoat......you could own up to the fact your party had complete control of all government for 6 years.
Posted by: bill r. | September 27, 2008 3:10 PM
Milm- THEY JUST HAD THE STORY ABOUT THE 20% of a LARGE sum (they said) on MSM. It's also, made it's way to the internet now as well.
They reported that Congress HAS STILL NOT REMOVED THAT MONEY FROM THE BAILOUT MONEY.
http://www.worldnetdaily.com/index.php?pageId=73335
Tax payers should get % of profit before any lobbyist or govt related groups, because it's OUR MONEY not ACORN's. If they want a % they should put some money into it. They sure owe us THAT MUCH.
http://www.consumersrightsleague.org/UploadedFiles/ACORN_AHC_Report.pdf
SAMPLE FROM ABOVE SITE> ACORN works to drive big businesses out of cities and force companies that want to move to obtain "exit visas."
Posted by: IT'S TIME TO BURST THE OBAMA BUBBLE | September 27, 2008 3:29 PM
It's time -- AGAIN -- read all the facts, not just the parts you want to hear -- it's a percentage of a percentage of profits, IF there is any profit. AND -- it is going to a group that would help those who need the help the most. Seriously -- why are you so afraid of the downtrodden and minorities getting a fair shake, getting an opportunity to own a home and give their families a better life?
Answer that question.
What are you afraid of????
Posted by: Milw-Town | September 27, 2008 4:45 PM
Actually, MSM just reported it to be BILLIONS of dollars that DEMS are trying to funnel to ACORN in this bill.
I was unable to get a loan a couple of times for a house and was told I didn't qualify. I accepted that...but years later I'm finding out that minorities making the same as ME or with little or no money (some on welfare, some from other countries here illegally) were given loans in such numbers that it has BANKRUPTED OUR COUNTRY, AND I AM BEING ASKED TO BAIL THEM OUT !
The bottom line, is that if CRA NEVER EXISTED (which would mean that ACORN wouldn't have been rewarded as an official group with all this power)>WE WOULD NOT BE IN THIS MESS TODAY. You can avoid that fact, but it's still a fact.
Posted by: LIBERALISM RUN AMUCK | September 27, 2008 8:07 PM
Sounds like "Liberalism" is a bigot and a racist. (and I'm guessing "It's Time" and "No Bailout" are the same person.)
Loans are not just based on your income. There were obviously other reasons, such as credit rating, etc. Don't blame minorities on your failings.
Posted by: Tracy | September 27, 2008 9:12 PM
Ron Paul told the nation the over spending by Washington was a serious matter but he could not sell the rest of the package. I assume you agree we gave him that issue "beyond a doubt."
So we have two "wannabes" sitting in a room with the real thing (Friday at the White House). What have you got when two wannabes and the real thing sit together in a room at the White House?
Three losers!
Posted by: Ervin Kreutter | September 27, 2008 9:23 PM
When Bill Clinton eased banking restrictions, he dished out $8-billion dollars for "community reinvestment loans.” The money just evaporated. When the “creative financing” schemes fell through, as is their wont whenever 30-million Mexican nationals buy inflated properties and default, it left banks in the lurch. Never mind that the aforementioned demographic is the new face of the Democratic Party; the mortgages morphed into “toxic” instruments. Hillary Clinton counted on the loan giveaways to buy votes. Interestingly enough, had Hillary secured the nomination; she, instead of Barack Obama would preside over the bailout. So, why should Americans perpetuate the housing bubble? Because it’s a scam! And, this is its well-timed exit strategy. Where is that $8-bilion plus dollars? The crooks stole my money; they even stole my car. Shame on them. The bubble is the problem, let it burst: http://theseedsof9-11.com
Posted by: Peggy McGilligan | September 27, 2008 10:26 PM
No. Bush is hoping the bailout will benefit him and his last 3 1/2 months--buying time and pushing a real crisis on to the next pres. I have a feeling the bailout will get Bush, Cheney, and their families and buddies free meals, homes, cars, gas and vacations for the rest of their lives. Thinking, too, any votes for a bailout would get all the 'yea' congress people the same freebies. Excuse me, I just cried and puked on the Preamble to the Constitution.
Posted by: Vivian | September 27, 2008 11:17 PM
From that tiny lie of an acorn, rose that mighty oak of more lies and distortions. The Bush-McCain Republicans are grunting for acorns, they have nothing else to offer the electorate. Lies and distortions, keep them coming, guys and gals of the Bush-McCain Republican wing, it only confirms what most of the nation already knows !! You are only echoes of the Bush administration and don't forget, an acorn a day, will almost keep the embarrassment away !! The embarrassment of your bankrupt ticket, of McCain-Who, who are going to that Bridge to Nowhere, fast !!
SUPPORT OUR TROOPS, BRING THEM HOME, ALIVE AND WHOLE. NOW.
Posted by: Don Fitzgerald, Chicago | September 28, 2008 4:52 AM
You make one mistake in your blurred liberal thinking. In Clinton's efforts to do this great hearted thing (to boost up a bubble that burts on him at the time $$$$$$ ha) he gave ridiculous power to CRA and a group of Organizers that were all bundled together in ACORN and allowed them to COMPLETELY CONTROL FINANCES OF PRIVATE BUSINESS IN A FREE COUNTRY, all this this NAME OF THE POOR (yeah right $$$$$). That my dears is SOCIALISM and bailing them out is NO DIFFERENT.
Banks opperated for years with good sound judgement. The CRA took that away, and it's not the fault of BANKS FOR THAT. Now, I agree that some on the top made BIG CEO dollars depending on performance (most productive in selling loans that were BOGUS) but they payed congressmen GOOD DONATIONS to make sure they are safe and in place (everyone profited).
WAKE UP... the start of CEO's getting that UNBELIEVABLE PAY was BORN OUT OF THE INCEPTION OF THE CRA/ACORN when the good judgement of banks was taken away. That's what happens when you interfere in free enterprise and try and REGULATE emotions....or as some of us call COMPLETE AND UTTER GREED ! ! !
Posted by: Make friends with Koolaid, make koolaid with friends | September 28, 2008 5:39 AM
All our leaders should be fired, they have totally failed Americans. All they did was pointing figures and be loud, especially the liberals.
Cut the crap, I am a minority, it should be about willing-to-work-hard Americans or non-Americans.
Why should we bailout
1.the rich in the wall street
2. the irresponsible home-owners
3. the illegal aliens
First we let the corrupted get fat, then we rewarded the lazy with free hand-outs (gimme gimme more), then we changed our language infra structure, then provided free education and health care, and now we have to help to pay for their house mortgage while we have to struggle to have our ends met?
What kind of representatives we have in the government???
Posted by: DoItRight | September 28, 2008 9:24 AM