State congressmen hesitant on bailout
WASHINGTON – Alabama lawmakers are talking tough about their concerns with putting taxpayers on the hook for a $700 billion Wall Street rescue. But even the staunchest free-market conservatives in Congress say government intervention may be necessary.
Led by Republican Sen. Richard Shelby of Tuscaloosa, members from both parties are expressing frustration with mismanagement in the corporate world and a lack of oversight from Washington. They also say they don’t like being pressured to act immediately
on the Bush administration’s proposal.
Still, while lawmakers said they’ll wait to see the final language, the delegation largely appears open to some sort of publicly financed bailout aimed at protecting retirement funds and avoiding a prolonged recession.
“I am very troubled that our tax money could be used to bail out companies that went after the easy buck,” said Rep. Robert Aderholt, R-Haleyville. “However, I am also distressed that many financial experts claim that a lack of confidence in the markets could lead to an economic depression.”
Rep. Bud Cramer, D-Huntsville, said a government response is “essential,” while Rep. Artur Davis, D-Birmingham, said “Congress’ credibility is on the line” if it can’t come together around a remedy.
No Alabama members said they wanted to immediately accept the Bush administration’s proposal to buy up shaky assets at the core of the problem, even though the White House has warned that the country is at risk of a “calamity” without decisive action.
Several members said Congress still doesn’t fully understand what is being proposed and can’t get a handle on whether it will work.
“I am concerned that we don’t know just how much we don’t know,” said Rep. Terry Everett, R-Rehobeth.
Sen. Jeff Sessions, R-Mobile, said “the burden is on the administration to demonstrate that this unprecedented interference with the financial market is justified.”
Shelby, a lead negotiator on the issue as the top Republican on the Senate Banking Committee, has been among the most vocal critics of the White House plan. He has said that some form of fix is probably necessary but that Congress should take a different approach using fewer tax dollars.
Rep. Spencer Bachus of Vestavia Hills, another Alabama lawmaker deeply involved in the crisis as the lead Republican on the House Financial Services Committee, has expressed similar concerns.
“I continue to worry about this notion of capitalism on the way up and socialism on the way down where large financial corporations keep the profit but when the investments turn sour, the taxpayer is asked to bail them out,” Bachus said.