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Paulson Raps Mortgage Rescue Plans

Says taxpayers shouldn't finance 'bailouts' for reckless lenders and borrowers

By Jim O'Neill,  Newser User

Posted Feb 28, 2008 7:06 AM CST

(Newser) – Homeowners burned by the subprime mortgage meltdown shouldn't be looking to the federal government for help, Treasury Secretary Henry Paulson told the Wall Street Journal yesterday. Facing down mounting congressional pressure for stronger measures to stem an epidemic of foreclosures, Paulson dismissed proposals on the table as "bailouts" for reckless lenders, investors and speculators.

"I don't think I've seen any scenario where the American taxpayer needs to be stepping in with more taxpayer dollars," Paulson said. Despite signs that the crisis is worsening, with as many as two million Americans likely to face foreclosure this year, Paulson says he sees no need to go beyond an administration plan that focuses on lenders working toward a solution with struggling borrowers.

Treasury Secretary Henry Paulson gives his assessment of the American economy while testifying on Capitol Hill in Washington, Wednesday, Feb. 13, 2008, before the House Budget Committee. (AP Photo/J. Scott Applewhite)
Treasury Secretary Henry Paulson gives his assessment of the American economy while testifying on Capitol Hill in Washington, Wednesday, Feb. 13, 2008, before the House Budget Committee. (AP Photo/J....   (Associated Press)
Treasury Secretary Henry Paulson, gives his assessment of the economy while testifying on Capitol Hill in Washington, Wednesday, Feb. 13, 2008, before the House Budget Committee.  (AP Photo/J. Scott Applewhite)
Treasury Secretary Henry Paulson, gives his assessment of the economy while testifying on Capitol Hill in Washington, Wednesday, Feb. 13, 2008, before the House Budget Committee. (AP Photo/J. Scott Applewhite)   (Associated Press)
Federal Reserve Board Chairman Ben Bernanke, right, and Treasury Secretary Henry Paulson, left, appear before the Senate Banking Committee on Capitol Hill in Washington, Thursday, Feb. 14, 2008, to discuss the state of the economy.  (AP Photo/Dennis Cook)
Federal Reserve Board Chairman Ben Bernanke, right, and Treasury Secretary Henry Paulson, left, appear before the Senate Banking Committee on Capitol Hill in Washington, Thursday, Feb. 14, 2008, to discuss...   (Associated Press)
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