Bailout dissenter talks about Senate bill
After the financial rescue plan failed in the House, Kai Ryssdal checked in with Democratic Rep. Peter DeFazio to talk about his No vote. Now that the Senate has come up with a new version, Kai calls him back.
U.S Rep. Peter DeFazio (Jonathan Ernst/Getty Images)
More on The Economy, Wall Street, Politics, Fed. Budget/Govt. Spending, America's Financial Crisis
TEXT OF STORY
Kai Ryssdal: After the House voted down the bailout package Monday, we had Oregon Democrat Peter DeFazio on to ask him about his no vote. We've got him back on the line today to talk about the latest proposal. Congressman, good to speak with you again.
Peter DeFazio: Thanks, Kai. I appreciate the opportunity.
Ryssdal: First things first, sir. Is this new version of the bill going through the Senate gonna do it for you?
DeFazio: Absolutely not. It is the same Paulson plan, which, in short, is what he started with. He gets $700 billion, unbelievable discretion in how he spends it. He can pick winners and losers on Wall Street. He can even buy credit card debt. He could probably buy pawn shop notes. I don't know, he can buy any kind of security under this authority. I don't buy the premise. I don't think it's going to solve the underlying, I know it's not going to solve the underlying problem with housing. And I don't believe it goes directly to the bank liquidity issue, which could be addressed much more simply and at less cost and risk.
Ryssdal: Well, it has some of the things you were looking for. It's got changes to the SEC rule in mark-to-market, it's got a raise on the FDIC limits for bank insurance. What's not there that you want to see?
DeFazio: How about re-authorize the certificates of net worth so that the regulators can work with banks that are in temporary trouble but long term are gonna be fine, to keep them from closing up shop. Permanently ban naked short selling. Put those things in and then say, let's fence the money off, and say, let's see if these measures work. I talked to the head of the Oregon bankers and she said, look, if you do mark-to-market, you do the FDIC insurance, my members don't have any problems and we don't need any of the $600, $700 billion.
Ryssdal: I know it's not necessarily your job in the House leadership, but count noses for me on a possible House vote on this Senate bill.
DeFazio: It's complicated. The Senate's trying to jam the House, here. I mean, they've taken the Paulson-Bush bill and they've added in a bunch of tax cuts, which on the Republican side of the aisle normally would attract votes. They put in mental-health parity, which has tremendous attraction to liberals and progressives, I mean, a whole lot of people across the board actually on that issue. So, they're thinking they can buy the votes here. But I just think it's too big of a price at $700 billion, but maybe they will move enough votes.
Ryssdal: Well, on that point, is there a sense among the leadership that something has to pass?
DeFazio: Oh, yeah. I mean, I think, everybody thinks something has to pass. But I think people feel that they need some sort of confirmation or stamp or push by Congress. So, what I'm saying is, if you could condition them drawing on this money to first implementing all these other measures and see if that takes care of the bank problem, which some people say it will. And the one other critical thing for me is don't put taxpayers on the line for the Paulson bet here.
Ryssdal: Last time we spoke, Congressman, I asked you about your constituent service line and how those calls were running, and you said, pretty heavily against this bill. Any change since the last vote?
DeFazio: We're close to 6,000 e-mails and phone calls now. It's gone from 100-to-1 against to about 95-to-1 against.
Ryssdal:: Even with the DOW down 777 points the other day.
DeFazio: We get very few immediate calls on that. We had a few. We had people call from my district and identify themselves by name and saying, look I know I'm losing some money here, but markets go down, they go up. We think you're doing the right thing for the country.
Ryssdal: All right, Peter DeFazio, Congressman from Oregon. He's a Democrat. Congressman, thanks a lot.
DeFazio: Thank you.
Comments
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From AZ, 10/02/2008
I cannot believe Defazio is at it again. He is wrong in his position. Some of the stuff he mention is in the bill. And the blame, the new regulations, we can do that after this passes. Stop dickering about who's to blame and put out this fire now.
All we hear are these sound bites and that's what the constituents are running on. All the AZ reps voted no. I will make sure I'll vote no on them too.
From Stillwater, OK, 10/02/2008
I thought I had a pretty decent of the mortgage meltdown, but recently a couple of my friends have suggested that the only reason the bankers would approve a NINA application or make a sub-prime loan at all is that "the government" forced them to do it. Could this be true?
From Philomath, OR, 10/02/2008
Hi Kai,
Great show.
What I don't understand is why Nancy Paloci and the other Democrats and Republicans didn't change the bill!!!! Why are they pushing it so hard and not looking at fixing it. Mr. Defazio represents my district. He regularly gives town hall meetings even in my small town and sends out news letters keeping us up to date on things in congress. We're grateful he's leading this charge.
From Lancaster, PA, 10/02/2008
I run a small business in southeasern PA. We are having a tough year do to the economy, but I am still not in favor of this bailout. Our bank has worked with us through this tough econmic time. The people in Congress are completely out of touch with what really is going on in Main Street USA. They constantley try and use fear as a motivator to "push through" unecessary legislation. We are already in a recession. Isn't that the basis of a free market economy you go through expansions and retractions. We need to let the cycle run it;s course.
From McKinney, TX, 10/02/2008
We the People demand that a bailout not be a "tax the poor to provide a Happy Hour / Buffet" of taxpayer money for lobbyists, the special interests they are paid to represent, and the congressmen they pay for.
We the people only accept the bailout if the lobbyists are banned from influencing it, corrupt laws that allowed the mess to happen are repealed, re-institute ethics and finiancial responsibility laws, a bi-partisan panel makes accountable decisions on who gets the money, and No executive management gets paid a bonus for his tax money grab.
From San Jose, CA, 10/01/2008
Thanks for the news story. My local congressman voted in favor of this Bill; I'm now seriously looking at alternative. I visited Ralph Naders website for the first time and googled about the Green Party.
From Gainesville, VA, 10/01/2008
This is how critical the situation is - I was shocked to find out that for the first time ever, I have something in common with Newt Gingrich! That is, opposition to this bailout plan. I am glad to see that there are some on Capitol Hill who have the guts to fight this attempt at "supply-side socialism." Perhaps if someone tried to explain why we need this, how it will help, and why existing means aren't being used, there might be some public support for it. Instead, all we hear is alarmist rhetoric about how dire are the consequences of not acting. Never trust someone who says "trust me!"
From Louisville, KY, 10/01/2008
Hey, Kai! (and buddies)
Love the show!
Am I reading this right?: Defaizio , when he says,"They put in mental-health parity, which has tremendous attraction to liberals and progressives..."
Are these people in Congress playing the "loading" game?...tagging unrelated items onto the BailOut deal? ...trying to get it to fly that way?
I've never liked that sorta bunk anyway, but can you get with Defazio again and see if someone can get an amnesty on those games for, at least, THIS one time? The Gravity of it all!!! Can't they stop playing their bullsh*t games ONCE in a while?
From King City, CA, 10/01/2008
I agree with Mr. Defazio that I feel the $700 billion bailout is being shoved down our throats. It seems that no voice is given to any other idea other than this, which just makes me shudder. I've heard nothing but bad about the mark to market and I learned today that this has been included in the deal. What can we do? Nothing, but pay the bill. Thanks so much for your reporting. I feel this is the only fair place to go to get the real truth. Carol
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