Thankfully, Peter DeFazio voted against the bailout and has proposed a more realistic plan which Dennis Kucinich supports. This email from DeFazio helps outline the concerns of many of the nations top economists.
I think Congress should respond, but the basic premise of the Bush Administration bailout is flawed. Almost 200 economists wrote to Congress stating “As economists, we want to express to Congress our great concern for the plan proposed by Treasury Secretary Paulson”[1]. The letter went on to raise the issues of fairness, ambiguity, and the long-term effects. The former chairman of the Federal Deposit Insurance Corp in the Reagan Administration wrote, “I have doubts that the $700 billion bailout, if enacted, would work. Would banks really be willing to part with the loans, and would the government be able to sell them in the marketplace on terms that the taxpayers would find acceptable?”[2] And James Galbraith, an economist at the University of Texas, has asked “Now that all five big investment banks — Bear Stearns, Merrill Lynch, Lehman Brothers, Goldman Sachs and Morgan Stanley — have disappeared or morphed into regular banks, a question arises. Is this bailout still necessary?”[3] I believe the answer is No. I have called on my colleagues to slow down this debate and seriously debate the alternative proposals.
Watch Kucinich discuss this with Rachel Maddow
