New provisions for Senate rescue bill
The Senate will vote on a new financial rescue package tonight with new provisions to pick up House votes. Scott Jagow talks to Steve Henn in Washington about what's new in the bill and how these additions could backfire.
Senator Chris Dodd is trailed by reporters outside the Senate Chamber. (Tim Sloan/AFP/Getty Images)
More on The Economy, Politics, America's Financial Crisis
TEXT OF INTERVIEW
Scott Jagow: The Senate has decided it will vote on a new financial rescue package tonight. It will include one provision we talked about yesterday: Increasing the limits on FDIC insurance for bank deposits from a hundred thousand to a quarter of a million dollars. Our reporter in Washington Steve Henn joins us as Marketplace continues its coverage of the financial crisis. OK, Steve, what else is in this bill?
Steve Henn: There's another thing that Senate leadership has decided to wrap into this bill: tax credits for renewable energy. This is an issue that's pretty popular in both parties, but there's been a big fight about how to pay for it. There's some talk about also including relief for the Alternative Minimum Tax, although last night that probably wasn't in the Senate version.
Jagow: Renewable energy and the Alternative Minimum Tax. What does that have to do with this financial rescue package?
Henn: Nothing . . . but they're looking to pick up Republican votes in the House. The thing is, especially with these tax credits for renewable energy, fiscally conservative Democrats in the House were all for this, but they wanted to pay for it. And they fought hard to force the Senate to pay for it too, so by including this they may actually lose some of those votes on Thursday.
Jagow: OK . . . so they might gain Republican votes, and lose Democratic votes?
Henn: Yeah, that's right. And you know hopefully, they're betting they'll gain more than they lose. But they need to pick up at least a dozen. So we'll see.
Jagow: All right, Steve Henn in Washington. Thanks.
Henn: Thanks.
Jagow: These people are unbelievable.
Comments
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From Beaufort, SC, 10/03/2008
Everyone on this blog is in agreement that the bailout legislation is a sham. President Bush, Treasury Secretary Paulson and the Congress have used fear-mongering to get this bill passed. The truth of the matter is that the economic crisis is limited to huge investment banks and their lack of responsibility and not the US banking industry in general. Take a look around at your local community banks and you will find that they have lots of credit available for small business owners. This is not a pandemic credit crisis as the politicians would have us believe. So I hope that everyone on this blog is contacting their respective district Congressmen in the US House of Representatives to encourage OUR elected representatives to vote NO to the current version of the bailout legislation. When contacting their offices make sure you remind them that you will no longer support their reelection campaigns if they vote in favor of the bailout. This is the time for all US citizens to voice their opinions to our elected officials. Time is of the essence because the US Congress is about to force it down our throats. Call you elected officials and let them know what you think. Otherwise this blog is in vain!! I was on the phone doing this yesterday after I read the pork-barrel spending that was added to the Senate version of the bill. Again, start calling!!
From Grantham, NH, 10/02/2008
Nothing changes just more pork barrel spending,the CEO don't get money but special interest do. Vote them all out.
From Fort Rucker, AL, 10/02/2008
i enjoy the show and felt the urge to comment on the ongoing crisis,bailout,rescue, u mentioned today. first of all lets not forget that money is just paper and the only value it has is what man places on it. that being said i think that the stock crunch is mostly poor confidence brought on by the very oz like characters that set prices and worthness. i think the economy needs this confidence boost to prevent the majority of impulsive and short term americans from jumping from their high office windows. its just money, its more debt, so what, most were not worried about affording their mortgage so why all the sudden a sense of financial responsibility? u know who the real losers are, americans that pay there bills on time and do not borrow more than they can manage. i guess at least were not hypocrites.
From Fort Rucker, AL, 10/02/2008
i enjoy the show and felt the urge to comment on the ongoing crisis,bailout,rescue, u mentioned today. first of all lets not forget that money is just paper and the only value it has is what man places on it. that being said i think that the stock crunch is mostly poor confidence brought on by the very oz like characters that set prices and worthness. i think the economy needs this confidence boost to prevent the majority of impulsive and short term americans from jumping from their high office windows. its just money, its more debt, so what, most were not worried about affording their mortgage so why all the sudden a sense of financial responsibility? u know who the real losers are, americans that pay there bills on time and do not borrow more than they can manage. i guess at least were not hypocrites.
From Pasadena, CA, 10/02/2008
To the Blog site of MarketPlace (KPCC)
10.2.2008
Today Kai Risdall interviewed Rep. John Campbell of California's 48th Congressional District, about the bailout. Campbell insists that it is NOT a bailout. He contends that the taxpayer is NOT spending $700 billion, it's BUYING $700 billion worth of ASSETS. Well, I don't know, but I been told, you can't buy much without spending, and, my poor friend, it is not ASSETS we're being forced to buy, it is LIABILITIES. Kai, why didn't you clarify those points? Those were not slips of the tongue. Those were attempts to obscure the truth. Please.
From Montgomery, IL, 10/02/2008
Lets take away salaries for Congress (avg. of $150,000/year), President salary ($400,000/year), and VP ($250,000/year). Also, lets take away expense accounts for all of the government. If we have to do our part, then so must they. No raises, reduced healthcare, no secret service after presidency, no retirement funds after presidency, and no continued pay after presidency. Its ridiculous how the government covers their butts, and keep taking money from us taxpayers. Stop, stop, stop now!!!
From San Diego, CA, 10/02/2008
Where are the PENALTIES for all this bad behavior?? I have no sympathies for any of these companies that engaged in what amounts to legalized gambling with mortgage securities. I have no sympathies for most of those millions of Americans that signed on the dotted line for mortgages they KNEW they couldn't afford. There are some victims of real mortgage fraud here, but the larger number of loan defaults are the result of SIMPLE GREED: legally responsible and accountable adults that FALSELY STATED THEIR INCOME to qualify for a loan they could never repay with the express purpose of cashing in on a short-term gain as housing prices skyrocketed. And then more greed: Many took out HELOC loans on top of that and spent it on new SUV's, Ipods and the latest HD TV. Why should I or any other fiscally responsible taxpayer have to pick up the tab for this? Why shouldn't people bear responsibility for bad choices? How else do they learn to make better ones?
This is something utterly foul in the moral fabric of America that has bred this era of "Entitlement", the expectation that no matter how big the mess, it's someone else's responsibility to clean it up. It's not just on Wall Street or in Washington, it's in the American family where our kids boomerang home well into their 40's with mountain of credit card debt expecting mom and dad to feed, house them and pay off their debts while they "find themselves" or their dream job finally knocks at the door. Where is the tough love? Do our children ever learn to manage money if we continually pay their bills and bail them out debt? NO.
Now I'm being asked to foot what I'm sure is just the first of MANY bailout bills laced with 400+ pages of earmarks and riders benefiting the same rich, greedy corporate tycoons that just gambled away my retirement portfolio. There are NO penalties for the deeds that have been done, NO reforms to prevent future abuses and no one wants to even talk blame. In short, no lessons learned. How can I be anything but cynical about the future of American society and government?
From Council Bluffs, IA, 10/02/2008
I no longer live the in U.S.A. I now live in the U.S.S.A. (United Socialist States of America). This is just another "fix". Give the drunk another drink. They will be back for another bailout in a couple of years. We cannot spend our way out of this.
From melrose, MA, 10/02/2008
I hear lots of news fluff about the man on the street. I expect "marketplace" to be the one place where I will get a succinct description of pending bills.
you can hit the road, but please cover the issues in a technical way that the average viewer is educatated, not entertained.
thanks,
DM
From KY, 10/02/2008
We have thrown money at the market for years with the 401K. That is what has caused the stocks to be over priced. More money is just a temporary fix. In 3 more years we are going to have the some problem.
From Boise, ID, 10/01/2008
I'm a 23 year old struggling student. My education was tied up in stocks that went poof in the last six months. After hearing how companies managed by incompetent gamblers were getting money from my taxes because they made bad choices, and how I now have to get a second job to pay for college, I was livid. These people made desicions as the leaders of these institutions and should be held accountable, not get paid out with my money. I say no bailout, they dont need help, they need a lesson.
From Caldwell, ID, 10/01/2008
This bailout package should be stongly looked over by all Americans. We cannot trust the elective officials to be trustworthy enough to were they are looking out for our best interest. What do you expect from a President who supported a stimulus package of only 300.00 per American and 300.00 per child additionally. Than would not look at another stimulus package until he saw what this one did. We cannot live on pennies, and it was an insult as an American to even see how our leaders are not fit to run this country nor their own life. They have a big surprise coming. The American people will not put up with any kind of economic instability. This should be more than just helping financial businesses in peril of economic failure, the bailout package should be about American prosperity. One thing that should be looked at is helping stimulate businesses gain a competitive edge. We need to invest money into companies that can promote growth and create jobs. This will have to do not just with rebuilding the infrasture across the nation. We need new innovative businesses in every field of business, from construction to retail, from financial to manufacturing and I know that we were able to create this kind of growth in the 1940s thru the 1950s, that created a core foundation of the United States business base that we have relied on for many decades, but that has been slowly depleting and weakoning over the years that we are now in the position we are in today. We need investment dollars not credit dollars. When people and government rely on credit dollars instead of dollars that are created from profits and successful ventures than the result is disaster.
From Scottsdale, AZ, 10/01/2008
In my reading of the bail out bill that was rejected by the House there was a provision to give Bush $1 Billion of the $700 Billion for his discretionary spending.
Why is no one addressing this? Why does Bush need any budget related to the bail out?
From Miilwaukee, WI, 10/01/2008
Out of 55 Million 52 Million Paying on time
3M not paying on time. Help them with 0% loan of $30000 to pay Mortgage Payment. 30K amount comes from $15000 Average Mortgage Payment that one makes on Median Priced Home. So Banks & Mortgage companies gets their payment. Now we know that no bank had subprime or bad debt on their book. This would create environment of trust between banks thus melting the credit freeze. It would eventually help stop fruther decline in home prices. Borrowers get 2 years to sell the house. Government gets 2 years to do something to create jobs of these late paying borrowers.
Cost is
3M times thirty thousand = 900 billion
300000 * 30000 = 900000000000 = 900 billion
Note this amount is given in monthly payments so does not need to go out in one go. Goverment/Tax payers has better chances of getting it back. This model is also proven by Grameen Bank concept Nobel Laureate, Muhammad Yunus.
Note sure if this sound right but thought to run it by MarketPlace community.
From Green Bay, WI, 10/01/2008
Provisions must be made to force each lender to rework the mortgages to at least a 6% rate Fixed and keep them in their portfolio, Also the forclosed ones must be reversed and the same lender reworking take place. We would not have to be buying up their greedy operation. They just must settle for 6% instead of the 12% or so they are getting from the adjustable mtgs.
From Hudosn, WI, 10/01/2008
I've never submitted a comment to anyone before on any issue but this one has me really worked up.
I dont believe in a bailout package, no matter what the "icing on the cake". (yeah, I like the idea of renewable energy tax credits but it doesn't do a whit for the problem.) Wall Street has benefited from deregulation (80s) all these years and now they want protection. They got what they asked for (deregulation) and now want help. Main street has been neglected too long as our safety net was taken away with the changes in bankruptcy laws. I think we need the it back now! Include that in this sugar coating and then I might support it. Wall Street and Republicans hate welfare for anyone but themselves but in a different form. I say LET IT RIDE! We survived the great depression and we can do it again, except I dont think it will happen. The market will adjust and new money from elsewhere will take advantage of the cheap cost of these poorly managed companies. Hey guys, that is what free markets are all about!
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