A Sound Argument on the Financial Rescue Plan

By September 26, 2008Economy

From Kenneth D. Lewis, chairman, CEO and president of Bank of America, in today’s Wall Street Journal, “Main Street Needs The Treasury Plan“:

In our national debate about Treasury Secretary Hank Paulson’s proposed financial rescue package, we are having the wrong conversation.

This is not about how to bail out Wall Street. This is about saving the U.S. financial system for the benefit of American businesses, consumers and the economy at large. I believe that Mr. Paulson’s plan will accomplish this goal. Congress should include provisions it feels are necessary to ensure oversight and accountability. And it should then pass the legislation as soon as possible.

There is no question in my mind that our financial system and our economy are at risk. Right now, the flow of funds that makes our economy run is threatened by a lack of confidence in the value of financial assets, particularly mortgage assets. Financial institutions are extremely hesitant to purchase assets or lend money to one another to fund the system.

UPDATE (10:05 a.m.): The President’s statement this morning:

THE PRESIDENT: Good morning. My administration continues to work with the Congress on a rescue plan. And we need a rescue plan. This is — it’s hard work. Our proposal is a big proposal. And the reason it’s big and substantial is because we got a big problem.

We also need to move quickly. Now, anytime you have a plan this big, that is moving this quickly, that requires legislative approval, it creates challenges. Members want to be heard. They want to be able to express their opinions, and they should be allowed to express their opinions.

There are disagreements over aspects of the rescue plan, but there is no disagreement that something substantial must be done. The legislative process is sometimes not very pretty, but we are going to get a package passed. We will rise to the occasion. Republicans and Democrats will come together and pass a substantial rescue plan.

Thank you very much.



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