What Does a Rescue Plan Mean To Me?

Op-Ed

On Monday afternoon, the House of Representatives voted down the proposed financial rescue package. Even though there is strong disagreement on what must be done to cure America's economic ills, there is little argument among members of Congress that something must be done. Our country currently faces the largest economic emergency in a generation.

Despite the fact that Oklahoma's community banks have been responsible and remain strong, many of America's major lending institutions are on the brink of failure. Over the past few weeks we have seen one of our nation's largest banks sold for one dollar a share, three of America's five major investment banks fail, and the country's largest insurer nearly fail.

On Monday, I voted for the financial rescue package, because I believe the American banking system is at risk of total collapse. The slow and rolling failure of America's largest financial entities should cause great concern among all Oklahomans. Many of our citizen's count on banks and financial institutions to protect their life-savings, expand their businesses, finance major family purchases, and send their children to college. A failure of our lending institutions could destroy our nation's economy and cause many of our citizens to lose their jobs and homes.

I realize that spending hard-earned tax dollars to stabilize the banking industry is not popular. However, I believe the alternative, which is to do nothing, could lead to years of economic despair for our state and nation.

As we move forward toward a resolution of this crisis, my concerns lie not with Wall Street executives trying to save their reputations, but with the retirement account of the family-of-four in Claremore, with, the firefighter's pension in Muskogee, and the life-savings of the senior citizen in McAlester.

In the weeks to come, I will continue to monitor any proposal put forward that responsibly deals with the current financial emergency. As the debate in Congress continues, I feel it is important for the people of Oklahoma to have answers to some common questions about the plan that was proposed this past week:

Q: Did the plan write a check to the Treasury Secretary for $700 billion of taxpayer money?

A: No. The plan would have made $250 billion available to the Treasury Department, with strict requirements set by Congress for how the money could be used. The President could then seek more funds for the rescue program as needed. However, any such request would have required additional review and approval of Congress.

Q: Would the plan be transparent and include oversight to prevent future corruption and bad decision-making?

A: Yes. The package created a strong independent oversight board that could veto the Treasury Secretary's decisions. Members of the board would be appointed by both Democrats and Republicans.

Included in the package was a requirement for a non-partisan watchdog agency to conduct regular audits of the program to prevent waste, fraud, and abuse. Also included was a newly appointed independent Inspector General that would closely scrutinize the purchase and management of what the government buys.

Q: Did the rescue plan provide CEOs with "golden parachutes"?

A: Absolutely Not. One of the cornerstones of the plan was strict limitations on compensation for executives whose firms receive federal money.

Q: Did the plan include protections for the American people, provide insurance for taxpayers, and allow them to share in any financial gains from the program?

A: Yes. If the American people incurred losses, Wall Street would be responsible for repaying every dime. It also gave taxpayers a share of any profits, and put taxpayers first-in-line to recover money if a company fails. It required the President five years from now to submit a plan to ensure taxpayers had been repaid in full - with Wall Street making up the difference. These measures guaranteed security and financial reimbursement to the American people.

Q: How would this program have benefited everyday Oklahomans?

A: The major reason for the financial rescue plan was to insure that our banking system remained intact. If the American banking system were to collapse, car loans, student loans, home mortgages, home equity loans, and business expansion would come to a halt. If business transactions were to be hindered, payroll and benefits would become impossible to make. Private sector job growth would disappear and Oklahoma families could be put in serious financial risk.

Q: How would this plan have prevented additional home foreclosures and protect home owners?

A: Under the plan, the federal government would have been allowed to work with lenders of the mortgages that are purchased restructure financial terms. These changes would have included lengthening repayment times, and reducing principal or interest rates. By taking these measures, we could work to prevent the continued downturn in home values we see across the nation.

Q: Would this plan have solved every problem currently facing our nation's economy?

A. Unfortunately No. From job loss to the rising costs of energy, health care, and education, there are many other issues that we must also address. However, with this decisive action, we could prevent this crisis from becoming the type of economic catastrophe that occurred in the 1930s. Once this disaster is averted, we could then continue to tackle the other economic issues facing hard-working Oklahomans.

Source