WASHINGTON, D.C.  -  Watching the news recently, we’ve all heard a lot about the financial crisis on Wall Street. It’s hard to imagine that all the talk about “toxic paper” and “mortgage-backed securities” up in New York City would matter much to the daily lives of folks down here.  But it does, and the consequences of Congress not acting to address this crisis are as great here in East Alabama as they are on Wall Street.

Don’t get me wrong. When Secretary Paulson first came out with this $700 billion plan, I was stunned. I was extremely concerned for taxpayers about this proposal, and shared the disgust for the arrogance and greed of some on Wall Street who got us into this mess in the first place.
It struck me as bitterly ironic that Wall Street was asking hardworking American families, already struggling with high gas prices and layoffs, to rescue them.

As negotiations began, I talked with folks back home seeking their input. I attended lengthy closed door briefings with senior Treasury, White House and Congressional leaders. In both cases, I heard sobering evidence that the possibility of a severe economic downturn or depression was very real.

 Let me explain. 

Wall Street is experiencing a credit crunch because of chaos in the banking industry. Banks are in turmoil because of bad investments backed by risky mortgages. So as the real estate market slowed, and more people defaulted on their mortgages, banks began to fail. As more banks fail, the ones left are less likely to give credit to people like you and me. Without intervention, fear or even panic could set in and access to credit could dry up.

Like it or not, Main Street relies on credit – and when credit dries up, jobs disappear, home values fall and our economy tanks. As a small business owner, I’ve had to make payroll using a bank loan, knowing when business picks up I can pay it off. What happens if the bank will not give that loan? Either employees get laid off or the business closes.

Many families in East Alabama live paycheck to paycheck. I know what that’s like. My Dad was a firefighter and my Mom worked at a textile mill. Living paycheck to paycheck doesn’t allow the room to take care of emergencies, such as when the family car breaks down or the furnace goes out at home. A lot of folks depend on credit in those emergencies. What happens when that credit isn’t there?

That’s why this bill is about Main Street, not Wall Street. It’s far from perfect. I would liked to have seen more changes like increasing the FDIC insurance limit, more protections to shield taxpayers from risk, and adding a forbearance period for everyday working families facing foreclosure at no fault of their own.

But while imperfect, I believe its intentions are right. In the near term, the Federal government would take hold of bad debt currently choking banks. That should help ease the credit crunch, so banks can continue to provide loans to Main Street. Down the road, the government would sell these assets for a profit and the taxpayer should see a return on its investment. Fat Cat Wall Street executives will be held accountable without their golden parachutes. The whole program would be conducted with intense oversight.

I’ve heard firsthand people’s anger about the bill – and I’m angry too. I’ve also heard from many who reluctantly support it, as do I.  In my judgment, the economic turmoil is getting very close to us. Too close.

The last time our nation faced such dire circumstances we had a president named Herbert Hoover.  The Great Depression was the hard lesson of inaction.  Not acting today, I believe, will again put our entire economy – Main Street’s economy – at risk.  Not acting will prove that in times of grave economic crisis, Congress couldn’t get the job done.  Isn’t this really about leadership?

Since my first day in office, I have vowed to do the right thing for the people of East Alabama. I believe in my heart I have done that, while acknowledging it’s politically unpopular. I remain hopeful Congress will finish the job, and rise to the occasion to address the very real threats facing East Alabama’s Main Street, our jobs and our economy.