Thread: Plan to bail out US economy set to get the go-ahead

George Bush's $700bn plan to bail out US economy set to get the go-ahead
Sep 26 2008 By Donna Watson

GEORGE BUSH is set to get the $700billion he says he needs to save the US economy and prevent a global jobs bloodbath.

Leaders in Congress, who have to approve Dubya's colossal credit crunch bail-out plan for Wall Street, said last night that they had reached "fundamental agreement" on a deal.

There are strings attached - Bush will only get half the cash at first and the Democrats who run Capitol Hill want other changes to a plan that many of their voters hate.

But senior Democrat Chris Dodd, who chairs the Senate's banking committee, said the bail-out could be passed into law within days.

And Bush, who was discussing the crisis at the White House last night with the two men fighting to succeed him, said: "My hope is that we can reach an agreement very shortly."

Millions of Americans are furious over the £384billion rescue package. They claim the plan to buy up banks' "toxic" mortgage debts simply rewards fatcat bosses for making so many bad sub-prime loans in the first place.

But Bush has warned the angry American public that they have no choice. He says that without the bail-out, banks will stop lending to each other and the entire financial system will shut down.
That would plunge the world economy into a gigantic crisis and put millions out of work.

Congress have agreed to give Bush's treasury secretary Hank Paulson Û250billion at first, then another Û100billion if needed.

If he wants the other Û350billion, Congress will have to vote to approve it. It's a safety measure by the Democrats to make sure they keep some control over the cash.

The Democrats want curbs on the wages of bosses whose firms benefit from the deal, to ward off claims that they are funding the huge bonuses of the men who caused the crunch.

And they are demanding that the taxpayer be given shares in the rescued companies so that ordinary Americans will eventually have the chance to benefit from the deal.

Congressional leaders were set to meet White House officials to thrash out these details. Both sides seemed confident of an agreement.

Bush wants Barack Obama and John McCain to sign up to the plan and help him convince the sceptical US public.

Some experts doubt the bail-out will succeed in ending the credit crunch. And before going to the White House for their meeting with the president, the two candidates issued a joint statement describing the scheme as "flawed".

But they added: "We cannot risk an economic catastrophe."

The crisis has helped Obama in the opinion polls and McCain has suspended his campaign to focus on the rescue effort. Democrats accuse him of trying to claim the credit for a deal that had nothing to do with him.

Supporters of the Bush plan hope its benefits will spread around the world. And yesterday, Gordon Brown threw his weight behind Dubya's massive gamble.

The Prime Minister said: "Let us make sure we stabilise the financial system immediately. While the problem comes out of America, it has consequences for all of us.

"Every family will want to know we are doing everything in our power to ensure there is stability - for people's jobs, for people's mortgages, for people's standards of living."

Brown is at the United Nations in New York for talks with other leaders about the credit crunch and to press for action to make sure the UN meets its "Millennium Development Goals" on third world poverty.

But today, he will change his schedule and head to the White House to meet Bush.

Brown has no plans to offer a US-style bail-out to British banks. But he is pushing for tighter controls on the fatcats to make sure there is no repeat of the credit crunch.

He wants new rules to force banks to come clean about their losses, changes to make bank boards more responsible, a crackdown on bonuses for bosses and a new international watchdog for banks.

The Prime Minister is keen to show that he is leading the way in tackling the crisis. He has staked his political future on the argument that he is the man to lead Britain through the economic storm.

HOW IT WILL WORK

WHY IS BUSH ACTING NOW?

The US financial markets are in turmoil, with the Dow Jones share index plunging last week.

The root of the collapse is the fear that banks and other institutions still hold too many "toxic assets" based on mortgages that are going bad. One in 10 US mortgage holders is at least 90 days in arrears.

WHAT ARE THE TREASURY PLANNING TO DO?

The Treasury are asking for authority to purchase these "troubled assets" that are clogging up the markets, which would allow banks to start lending again. They also want to purchase "any other assets as deemed necessary to stabilise the financial system".

WHERE WILL THE CASH COME FROM?

The US government will borrow from world financial markets. The hope is they will sell them back into the markets once the housing market stabilises.

http://tinyurl.com/3lvds9

And Bush, who was discussing the crisis at the White House last night with the two men fighting to succeed him, said: "My hope is that we can reach an agreement very shortly."

IT is MY GOAL TO STOP YOU AND YOUR FAT CAT BUDDIES IN YOUR TRACKS!!!!

Originally Posted by April

And Bush, who was discussing the crisis at the White House last night with the two men fighting to succeed him, said: "My hope is that we can reach an agreement very shortly."

IT is MY GOAL TO STOP YOU AND YOUR FAT CAT BUDDIES IN YOUR TRACKS!!!!

That makes two of us!

But they added: "We cannot risk an economic catastrophe."

But that's what they already made while they were wheeling, dealing, dining and STEALING!!!

Originally Posted by IndianaJones

But they added: "We cannot risk an economic catastrophe."

But that's what they already made while they were wheeling, dealing, dining and STEALING!!!

ABSOLUTELY, they think they can make up any stupid lie they want and use it as an excuse to walk all over us!! I SAY NO!!! ENOUGH IS ENOUGH!!!