Rep. Ed Perlmutter, a member of the key House Financial Services Committee, on Monday added his voice to a chorus urging caution in the face of a $700 billion Treasury Department proposal to bail out troubled credit markets. “[I] have doubts about the foxes guarding the henhouse or giving the Bush Administration any more authority over anything,” the first-term Democrat said in a statement.
Treasury Secretary Henry Paulson is scheduled to present his bailout plan on Wednesday to the House committee, which has jurisdiction over the nation’s financial markets. Monday afternoon, the committee’s chairman, Rep. Barney Frank, said Paulson had agreed the government would get equity in companies that agreed to a government buy-out of their “toxic debt.” Frank and Senate Banking Committee Chairman Christopher Dodd have been leading negotiations over the massive plan Paulson unveiled Thursday in late-night meetings with congressional leaders.
Perlmutter blames the Bush Administration for aggressive deregulation and credit policies leading to the current crisis. “Now, bailouts, takeovers and bankruptcies of unbelievable proportions demonstrate the party is over,” he said.
Paulson has said he requires a “clean” bill without added provisions, while Democrats have said Congress shouldn’t hand over so much money without a range of proposals, including relief for homeowners facing foreclosure and economic stimulus plans. In the statement issued Monday, Perlmutter makes clear which side he’s on:
“I am committed to a responsible plan that will restore some restraint in the financial markets, tighten up out of control compensation for executives, rebuild the country’s infrastructure, create a new energy economy, protect taxpayers and reduce foreign borrowing.”
A spokesman said Monday that Perlmutter plans to publish an opinion article in Tuesday’s Rocky Mountain News further explaining his position and expectations before Paulson testifies to his committee.