FOR IMMEDIATE RELEASE
October 3, 2008

Washington, D.C.—Below is Congressman William Jefferson’s statement on H.R. 1424, The Emergency Economic Stabilization Act of 2008.

Today, I again, voted against the Wall Street Bailout plan. Its focus is still on supporting financial institutions rather than rescuing homeowners and small businesses, and it is unnecessarily expensive, crowding out the availability of federal appropriations for important domestic spending, including spending still needed for our recovery. Additionally, it gives too much authority to the Secretary of the Treasury, authority to buy anything, from anyone, at any price – even to buy bad debts from foreign banks or to pay for bad real-estate loans at inflated prices. Taxpayers will be the losers in the end, as we add nearly a trillion to our national debt – to be paid by our children and grandchildren.

The problem of tight credit and bad real-estate loan backed securities should be handled by restructuring homeowner debt. Fixing these mortgages would allow the securities that they back to take care of themselves. This would put money in the hands of financial institutions, to lend to each other and to small businesses. At the same time it would relieve the burdens of homeowners who have been induced by an unregulated financial system to make loans they cannot afford. Further the problem of rescuing financial institutions could have been handled with government backed credit insurance and guarantees that do not involve the expenditures of upfront cash outlays. Leading economists in our country also urged superior approaches to dealing with our current economic problems than the path Congress is committed to taking. They also expressed serious doubts as to whether the bailout plan will work. Unfortunately, none of their suggestions were taken. Therefore, I voted “NO” on the bailout bill today.