by Kevin Flynn - Friday September 19 2008 08:10:47 AM
From the Washington Post:
Barack Obama turned to a team of advisers that shaped America's economy in happier days to fashion fresh ideas for calming the stomach-churning financial crisis that has thundered from Wall Street to Main Street.
Some of the most respected names in the business world were pitching in Friday, including billionaire investor Warren Buffett, former Federal Reserve Chairman Paul Volcker, former Treasury secretaries Robert Rubin, Lawrence Summers and Paul O'Neill and Laura Tyson, former head of the Council of Economic Advisers under President Clinton.
..."This is not a time for fear, it's not a time for panic," Obama said Thursday in New Mexico. "This is a time for resolve and it is a time for leadership."
...Briefly outlining his proposals, Obama said he would call for a Homeowner and Financial Support Act "that would establish a more stable and permanent solution than the daily improvisations that have characterized policy-making over the past year."
...Obama had telephone discussions Thursday about the financial markets with Federal Reserve Chairman Ben Bernanke, Treasury Secretary Henry Paulson, New York Mayor Michael Bloomberg, former Fed chief Paul Volcker and former Treasury Secretary Lawrence Summers.
Saying that McCain strongly advocated deregulation and then changed his mind, Obama said, "We can't afford to lurch back and forth between positions depending on the latest news of the day when dealing with an economic crisis.
"We need some clear and steady leadership and that's why I was ahead of the curve in calling for regulation," he said. "And that's why I'm calling on the Treasury and the Federal Reserve to use their emergency authorities to maintain the flow of credit, to support the availability of mortgages and to ensure that our financial system is well capitalized."
Presidential candidate Barack Obama urged the Federal Reserve and the Treasury on Thursday to take emergency steps to keep credit flowing to the troubled housing market, saying it would help stem the crisis sweeping financial markets.
"The events of the past few days have made clear that we need to do more right now," the Democratic senator from Illinois told a campaign rally in New Mexico.
"That is why I am calling on the Treasury and the Federal Reserve to use their emergency authorities to maintain the flow of credit, to support the availability of mortgages, and to ensure that our financial system is well-capitalized."
...As Wall Street grapples with the worst crisis since the Great Depression, the financial turmoil has become the top theme on the campaign trail...
...In addition to calling for a short-term boost to the mortgage market by the Fed and Treasury, Obama also called for legislation that he said would provide a longer-term remedy to the Wall Street turbulence by giving policy makers better tools for managing problems.
...Obama said the legislation would allow for the addition of capital to the financial system and replenishing liquidity to restore the normal functioning of financial markets.
It would also include a proposal he has previously called for that would allow struggling homeowners to restructure their mortgages.
As markets began to melt down on Monday, both Obama and McCain, an Arizona senator, called for a broader overhaul of regulation on Wall Street, including a bolstering of the oversight role of agencies like the Securities and Exchange Commission.
...But Obama, who proposed a revamp of financial regulations in a March speech, has accused McCain of being a late convert to stricter market oversight and has mocked him for saying this week that the fundamentals of the economy were strong.
From the New York Times:
The head of the Treasury and the Federal Reserve began discussions on Thursday with Congressional leaders on what could become the biggest bailout in United States history.
While details remain to be worked out, the plan is likely to authorize the government to buy distressed mortgages at deep discounts from banks and other institutions. The proposal could result in the most direct commitment of taxpayer funds so far in the financial crisis that Fed and Treasury officials say is the worst they have ever seen.
...Democrats, having their own desire for a second round of economic aid for struggling Americans, see the administration’s request as a way to win White House approval of new spending to help stimulate the economy in exchange for support for the Treasury request. Democrats also say they will push for relief for homeowners faced with foreclosure in return for supporting any broad bailout of struggling financial institutions.
...The scale and complexity of the project are almost certain to create huge philosophical differences among the parties, which could make negotiations difficult to say the least. Still, lawmakers said the goal was to work through the coming weekend and to have both the House and Senate vote on a measure by the end of next week.
...Nancy Pelosi, the House speaker, in a letter sent Thursday evening to President Bush, reiterated that view. “We stand ready beyond the targeted adjournment date of September 26 to permit Congress to consider legislative proposals and conduct necessary investigations,” Ms. Pelosi said in the letter, which said “the worsening crisis in our financial markets demands strong solutions and decisive leadership.”
From the Associated Press:
Democratic vice presidential candidate Joe Biden on Thursday called Republican John McCain's answers to the current economic crisis "the ultimate bridge to nowhere"...
...Biden's two-day bus trip in the region includes stops in areas devastated by thousands of job losses in manufacturing and the auto industry. With the economy a top concern in Ohio, polls were tight in this essential swing state.
...The reference to the infamous Alaska project dubbed "the Bridge to Nowhere" was a dig at McCain's running mate, Alaska Gov. Sarah Palin, who supported building the bridge until Congress moved to kill it as an example of wasteful spending. She has since claimed she stopped the project — a nearly $400 million structure designed to link a southeastern Alaska town to its airport on a nearby island — and told Congress "thanks, but no thanks" when, in fact, the state diverted the money to other projects.
..."We want to take money and put it back in the pocket of middle-class people," Biden said. Of those who would pay more, he said: "It's time to be patriotic ... time to jump in, time to be part of the deal, time to help get America out of the rut."
...Although McCain claims Obama would raise taxes, the independent Tax Policy Center and other groups conclude that four out of five U.S. households would receive tax cuts under Obama's proposals.