Congressman McGovern's Statement on the Emergency Economic Stabilization Act

Press Release

On Monday, I voted in support of H.R. 3997, the Emergency Economic Stabilization Act.

This was a difficult vote. Like my constituents, I am angry at the people who got us into this mess -- greedy Wall Street fat cats and the anything-goes, no-regulation, "Cowboy Capitalism" Bush Administration.

The problem is that this crisis has the potential to affect not just Wall Street, but Main Street. I've talked to dozens of economists over the last week. I came to the conclusion that if the credit system collapses, then the people I care about - my constituents - will be hurt. Car loans, student loans, mortgages - all will be harder to get. Small businesses that rely on credit to meet their payrolls would be forced to close, throwing people out of work. People's pensions and 401(K)'s would plummet in value. We cannot let that happen.

I believe that in addition to stabilizing the economy, we need a new stimulus targeted at the Middle Class. We must invest in our aging infrastructure - our roads, bridges, water and sewer systems - to create jobs. We must extend unemployment benefits to people looking for work. And we must expand Food Stamps and LIHEAP so that people who are struggling can put food on the table and heat their homes.

The bill we voted on yesterday was NOT the bill that Secretary Paulson first proposed. It was NOT a $700 billion blank check to Wall Street. There are several important provisions in the bill that are worth remembering:

The American taxpayer will not have to pay the cost. Under the plan, the government would purchase troubled assets, and when the economy recovers, sell those assets - hopefully at a profit. If after five years there is still a shortfall, the bill requires the President to submit a plan to make up the difference, not by raising taxes on individuals or by cutting programs, but by imposing fees on Wall Street.

Second, the bill contains strong help for the foreclosure crisis. The government can work with loan servicers to change the terms of mortgages (reduce principal or interest rate, lengthen time to pay back the mortgage) to reduce the 2 million projected foreclosures in the next year. And the bill extends provisions to stop tax liability on mortgage foreclosures.

Third, the bill bans multi-million dollar golden parachutes for executives who retire from failing companies. The people who got us into this mess must not be rewarded.

Congress will have to return soon to address this issue. If another vote occurs, please know that I will vote in support of keeping the hard-earned savings of my constituents secure.

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