|Bush: $700bn bail-out will stop crisis spreading
Evening Standard | September 29, 2008
George Bush today claimed that the $700billion US bank bail-out would help to halt the world financial crisis as he appealed to Congress to back the rescue package.
President Bush said the huge investment by American taxpayers would address the "root cause" of the problems which have seen credit markets across the world freeze up and the banking system plunged into disarray.
Mr Bush's comments were delivered in an early morning statement from the White House. The deal was agreed in the early hours yesterday after lengthy wrangling with critics in Congress worried about safeguards in the plan.
The President appealed for a swift endorsement of the legislation - the Emergency Economic Stabilization Act - which goes before the House of Representatives today. The Senate will get a vote later in the week. Mr Bush said it was a "bold Bill that will help keep the crisis in our financial system from spreading throughout our economy".
He added: "I'm confident that this rescue plan, along with other measures taken by the Treasury Department and the Federal Reserve, will begin to restore strength and stability to America's financial system and overall economy."
The President said he understood concerns about the large amount of money involved, but added that it was necessary to have an impact.
"In fact, we expect that over time much, if not all, of the tax dollars we invest will be paid back," he said.
Stock markets in Asia gave a downbeat reaction to the news that Washington had agreed the outline of the bail-out. In Hong Kong, the Hang Seng index fell 669.13 points to 18,012.96 while Tokyo's Nikkei closed 149.55 down at 11,743.61. In Singapore shares fell 32.45 to 2,379.01. Asian investors said they were still deeply worried about the lack of detail in the rescue plan. Agreement on the 110-page Bill "to provide authority for the federal government to purchase and insure certain types of troubled assets" was reached early yesterday after days of intense negotiations. At one stage an exhausted Hank Paulson, US Treasury Secretary and architect of the scheme, suffered "a woozy spell" and had to take a break.
As the world watched, all the participants in the talks agreed to put their BlackBerry mobile devices in a bin to stop details leaking out.
The outline deal was finally struck at
12.30am yesterday. Congressional leaders said they had secured key concessions that would give more protection to taxpayers than the initial draft.
Democratic Senate leader Harry Reid said: "They wanted a blank cheque and we couldn't give them one... Now we have to get the votes."
Four agencies will monitor the deal, including an independent inspector general and a bipartisan oversight board.