There’s a debate taking place between Congress, the Fed Chairman and the Treasury Secretary.  Or maybe I should say until tonight Congress has been having the debate by themselves. What is this about? Well Congress is upset that they have not been consulted regarding many of the decisions regarding bailouts and measures put in place over the past few weeks to strengthen markets. The AIG bailout in particular rankled both parties in Congress, as well as a lot of other folks, me included.Â
But do you know what could be worse? Letting Congress get involved in any short-term debate about financial markets. Congress can’t figure out how to put an energy plan together or come to any bipartisan progress over countless issues. So they expect when we’re having a national financial emergency that they will be consulted in order to debate and consider the implications? What are they going to do, subpoena the Treasury Secretary, SEC Chairman and countless Wall Street executives?  Hold hearings? Might be a good idea, except not right now! (And where have they been for the last few years?).
And today the Speaker of the House was grandstanding and blaming the current Administration’s “failed policies” for the crisis we’re facing. That really helps the situation doesn’t it? We’re all tired of the “bailout” news, and are looking for accountability. But instead of holding press conferences, you would think these folks could work together a little more effectively.
The Fed Chairman and Treasury Secretary may have averted financial calamity over the past week by actions that have been taken, and that serves the nation and the public as it should. Right or wrong, the Treasury Secretary and Chairman of the Federal Reserve are working overtime with countless teams of professionals to do what is best for the integrity of our nation, our people and the economy. These people are serving in their professions precisely because of their expertise, and Congress should work with them, rather than against them.Â
The House Majority Leader may have hit the mark saying, “No one knows what to do…” Pretty scary thought but it’s probably true! Yes Congress has a vital role in helping to solve this crisis, and is right to be concerned about the financial affairs of the nation.Â
The Fed and Treasury Secretary understand this, and tonight, Treasury Secretary Paulson, Fed Chairman Ben Bernanke and others are meeting with the full congressional leadership to talk about creation of specific accounts that might handle risky debt of financial institutions. It’s going to take a concerted effort by Congress to listen, and put partisan rancor aside in order to potentially pass legislation supporting the structural needs of the financial markets.Â
The plans being put together will need legislative approval and perhaps the government will stand together instead of holding partisan press conferences for a few weeks.   And don’t worry, there will be plenty of time for congressional hearings.Â
At some point many think we do need a great deal of reform and consideration for what’s happened over the past decade to the financial markets. We need to reign in excessive compensation structures, costs and fees and increase both transparency and accountability. But in the current climate, too many politicians are making political hay out of this crisis, and lengthy speeches do not serve the public interest. Let’s see everybody working together for a change, shall we?
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