Dems Set Their Own Terms for Bailout Plan

Congress wants oversight of treasury, homeowner assistance
By Jason Farago,  Newser Staff
Posted Sep 22, 2008 6:43 AM CDT
Treasury Secretary Henry Paulson Jr., left, confers with House Financial Services Committee Chairman Rep. Barney Frank, D-Mass., on Capitol Hill in Washington, Thursday, July 10, 2008.   (AP Photo/Manuel Balce Ceneta)
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(Newser) – As Hank Paulson did the Sunday talk shows, Democrats in the House and Senate set down their own terms for a plan to rescue the nation's financial institutions—one that would give Congress greater oversight over the treasury. Barney Frank, who chairs the House Financial Services Committee, put forward his party's changes to the Bush plan, which also include an assistance program for homeowners and a limit on executive compensation.

As the New York Times reports, Democrats as well as Republicans in Congress have been wary about giving the treasury secretary the nearly unlimited powers that the Bush administration is pushing for. But Paulson insisted yesterday that emergency measures should be introduced first, with reforms to follow. "If we design it so it’s punitive and so institutions aren’t going to participate, this won’t work the way we need it to work," said the treasury secretary.