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Daily Breeze: Area legislators oppose package

Sep 24, 2008
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Washington, Sep 24, 2008 - Two South Bay representatives expressed skepticism Tuesday about the Bush administration's proposal for a $700 billion Wall Street bailout.

The proposal calls for Congress to allow Treasury Secretary Henry Paulson to buy up distressed assets from the major financial firms to avert a massive economic slowdown.

Rep. Dana Rohrabacher, R-Huntington Beach, said he doesn't plan to support the proposal under any circumstances.

"I am not likely to vote for a massive program to extract money from people who have been responsible and give it to people who have been irresponsible," Rohrabacher said. "Every time a special interest wants to put their hand in the taxpayer's pocket, they create a crisis."

Rep. Jane Harman, D-El Segundo, said in a statement that she, too, has "misgivings" about the plan. She described it as "a blank check to the Treasury Department," and said that a proviso barring any administrative or judicial review of the plan was "particularly egregious."

"There is no question that the economy is in trouble, but our remedies need to be carefully tailored to homeowners and employees of firms whose executives took reckless and irresponsible risks," Harman said. "Limits on executive compensation and requirements for full transparency and oversight must be on the table."

On Capitol Hill on Tuesday, Senate Banking Committee Chairman Chris Dodd, D-Conn., described the administration's proposal as "unacceptable" in its present form.

Congressional Democrats have proposed several amendments, such as limits on CEO pay for those companies that participate, extra assistance for homeowners facing foreclosure, and greater oversight and transparency.

Paulson has argued for a "clean" bill, and urged the approval of the bailout before Congress goes on recess Friday.

Some, including Harman, have suggested extending the session in order to modify the bill.

"We should stay until we find the right answer to this problem," Harman said.

Rohrabacher, who represents the Palos Verdes Peninsula, said he believes limits on executive pay are fair.

"If any company has a government guarantee, we can put a lid on what the president of the company can scoop out and put in his own pocket," he said.

Rohrabacher identified Fannie Mae and Freddie Mac, the two massive mortgage banks that the federal government took over recently, as a major source of the crisis.

"When you say somebody's too big to fail, that means they're too big," he said. "We should make them smaller, rather than subsidizing them."

Rohrabacher also defended Christopher Cox, a Republican who represented Orange County in Congress for 17 years before becoming chairman of the Securities and Exchange Commission in 2005. Sen. John McCain, the Republican presidential nominee, urged that Cox be fired last week, citing his failure to rein in short-selling.

"The attempt to make Chris Cox a scapegoat is a very deceitful or ignorant approach to the problem," Rohrabacher said. "Most of the elements that have caused this near economic crisis have been brought on by policies that do not relate to Chris Cox's job."
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Original Article: Daily Breeze