Democrats propose revisions to bailout plan
The New York Times reported Tuesday that Senate Democrats on Monday put forward their version of the bailout rescue plan, including a bold addition aimed at helping homeowners at risk of foreclosure.
The provision offered by Senate Banking Committee Chairman Christopher Dodd, D-Conn., would require the government to receive an ownership stake in the companies it helps, requiring companies who sell assets to the government to give the government shares in the company, reported CNN.
President Bush urged legislators to resist the temptation to add provisions to the plan, reported the New York Times.
â€śThe whole world is watching to see if we can act quickly to shore up our markets and prevent damage to our capital markets, businesses, our housing sector, and retirement accounts,â€? President Bush said, reported CNN.
Congressional leaders donâ€™t want to give the Treasury Secretary a â€śblank checkâ€? without provisions that protect taxpayers, reported CNN.
The New York Times reported that the Senate Democratsâ€™ proposals include two additions, one that would grant the Treasury â€ścontingent sharesâ€? of stock in any financial institution that wants to sell bad debt to the government, and the other provision granting bankruptcy judges the authority to modify the terms of primary mortgages, a proposal aimed at helping homeowners at risk of foreclosure.
The Senate proposal would also require monthly reports to Congress rather than biannual reports that would be required under the Bush administrationâ€™s proposal, reported the New York Times.
CNN reported that the proposals being debated are the centerpiece of what would be the most sweeping economic intervention by the government since the Great Depression.
Both presidential nominees, who face the prospect of inheriting an enormous program, said there had to be more oversight of the Treasury Department than the Bush administration had proposed, reported the New York Times.
CNN reported that the mortgage plan is part of a remarkable effort by the federal government to contain a financial crisis that has forced a major realignment on Wall Street, one that has even started to ripple onto Main Street.