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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
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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.

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.
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)
In this photograph provided by Meet the Press, Treasury Secretary Henry Paulson appears on Meet the Press' with Tom Brokaw Sunday, Sept. 21, 2008, at the NBC studios in Washington.
In this photograph provided by "Meet the Press," Treasury Secretary Henry Paulson appears on "Meet the Press'" with Tom Brokaw Sunday, Sept. 21, 2008, at the NBC studios in Washington.   (AP Photo/Meet The Press, Alex Wong)
Leaders of the Congressional majority met with Henry Paulson, Ben Bernanke, and Christopher Cox this weekend.
Leaders of the Congressional majority met with Henry Paulson, Ben Bernanke, and Christopher Cox this weekend.   (AP Photo/Lauren Victoria Burke)
House Speaker Nancy Pelosi during a news conference on Capitol Hill in Washington, Tuesday, Sept. 9, 2008.
House Speaker Nancy Pelosi during a news conference on Capitol Hill in Washington, Tuesday, Sept. 9, 2008.   (AP Photo/Susan Walsh)
House Financial Services Chairman Rep. Barney Frank, D-Mass., during the committee's hearing on Capitol Hill in Washington, Wednesday, July 16, 2008, on monetary policy and the state of the economy.
House Financial Services Chairman Rep. Barney Frank, D-Mass., during the committee's hearing on Capitol Hill in Washington, Wednesday, July 16, 2008, on monetary policy and the state of the economy.   (AP Photo/Susan Walsh)
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A fast-moving battle of wills in Congress
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Congress • Congressional oversight • Henry Paulson • House Financial Services Committee • Treasury Department • Barney Frank • bailout • financial crisis

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