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September 29, 2008 Contact: Robert Reilly
Deputy Chief of Staff
Office: (717) 600-1919
 
  For Immediate Release    

Statement on the Defeat of Legislation Authorizing a $700 Billion Bail-out of Wall Street

 

 

 

“Earlier today the House of Representatives defeated legislation authorizing Treasury Secretary Henry Paulson to purchase up to $700 billion in troubled Wall Street investments with taxpayer funds.  I voted against this legislation which would have put American taxpayers on the hook for the reckless actions of Wall Street and irresponsible lenders with little certainty of truly solving the underlying causes of our nation’s economic challenges. 

The federal government clearly has a responsibility to help protect retirees, families, and small businesses on Main Street from the consequences of irresponsible conduct on Wall Street.  However, Congress must fulfill this significant responsibility in a manner that addresses the root causes of the economic risks facing our country and, importantly, best protects American taxpayers. 

Several viable alternatives to the Paulson Plan are readily available for consideration and would not put taxpayers at risk to the tune of $700 billion.  Congressional leaders wrongly refused to allow any of these alternatives to be considered on the House floor.  With the defeat of the Paulson Plan, Congressional leaders and the Bush Administration must now return to the negotiations process and ensure that these alternative proposals are duly considered. 

Although Administration and Congressional leaders worked to improve Secretary Paulson’s original blank check approach, these same leaders failed to fairly and thoughtfully incorporate bipartisan alternatives to the Paulson Plan into their deliberations.  In the end, the legislation considered was simply an amended version of Secretary Paulson’s original request for taxpayers to underwrite $700 billion in bad Wall Street investments.  The defeated legislation also would have increased the federal government’s debt limit from $10 trillion to $11.3 trillion, an increase of $1.3 trillion.

Given the long-term impacts of this bail-out package, Congress was right not to hastily pass it by an arbitrarily set deadline.  Rather, Congress should ensure that all possible solutions are thoroughly considered and the best interests of all Americans are protected.”

 

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