Snappy newsletters. Simple Facebook sharing. Spirited comments. Sweet features are waiting… GET THEM NOW!

Homeowners Need Bailout, Too: FDIC Chief

Regulator clashes with Paulson, Bernanke over relief for lenders

By Jim O'Neill, Newser User

Posted Oct 16, 2008 9:25 AM CDT

(Newser) – The FDIC chief is blasting the White House and Congress for focusing the $700 billion bailout on financial institutions and not giving homeowners facing foreclosure more help, reports the Wall Street Journal. Sheila Bair, a Bush appointee, says the government’s insistence that homeowners not profit from its help—while appearing unconcerned about institutional profiteering—has been “a frustration.”

A White House spokesman said the legislation "does a lot for homeowners," but the increasingly powerful regulator has been sounding the alarm over foreclosures for months. "Why there's been such a political focus on making sure we're not unduly helping borrowers but then we're providing all this massive assistance at the institutional level, I don't understand it," Bair said.

[Images (4)]

[Quotes (1)]

FDIC chair Sheila Bair testifies on Capitol Hill in Washington, Thursday, Jan. 31, 2008. (AP Photos/Susan Walsh)

Federal Deposit Insurance Corp Chairwoman Sheila Bair (AP Photo/Haraz N. Ghanbari)

Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke listen as FDIC Chairman Sheila Bair speaks during a press conference at the Treasury Department, Tuesday, Oct. 14, 2008. (AP Photo/Gerald Herbert)

Federal Reserve Chairman Ben Bernanke, and Treasury Secretary Henry Paulson arrive for a press conference at the Treasury Department in Washington, Tuesday, Oct. 14, 2008. (AP Photo/Gerald Herbert)

« Prev« Prev | Next »Next » Slideshow

Why there's been such a political focus on making sure we're not unduly helping borrowers but then we're providing all this massive assistance at the institutional level, I don't understand it."
- FDIC Chief Sheila Bair

« Prev« Prev | Next »Next » Slideshow

To report an error on this story, notify our editors.

More Newser Stories

Perry Gave Huge Tax Grants to Subprime Lenders

Countrywide, WaMu got $35M as they upped risky loans

(NEWSER) - Rick Perry handed mortgage lenders millions to draw them to Texas—right when their risky lending practices surged. The governor gave Countrywide $20 million and Washington Mutual $15 million in what he called an exemplary job-creation move; in effect, that $35 million subsidized dangerous subprime lending, an AP analysis of data and records finds. And when some began to fear the impending mortgage crisis, Perry's rep shrugged off their concerns as “slightly alarmist.” More»

Sheila Bair to Leave FDIC in July

Chair weathered financial crisis, oversaw closure of 350-plus banks

(AP) - Sheila Bair is stepping down as chairman of the Federal Deposit Insurance Corp. this summer, ending a five-year term in which she helped craft the government's response to the 2008 financial crisis. The FDIC says Bair will leave her post as one of the government's top bank regulators on July 8. More»

Final Bailout Tab: $29B

Bank bailout is highlight of latest accounting

(NEWSER) - So it's not exactly zero, but the $388 billion the feds dumped into bailouts is going to end up with a final price tag of ... $29 billion, reports the New York Times. Most of Treasury's losses are focused in housing rescues ($46 billion) and the Detroit bailout ($17 billion), while other segments of TARP actually reaped profits—like the $22 billion feds expect to pocket when they sell their stake in AIG. More»

US Bailout Funds Aided Foreign Firms

Watchdog says TARP spending aided France, Germany

(NEWSER) - A big slice of the $700 billion in bailout funds the US poured into the financial system ended up helping foreign companies, according to a report from a congressional watchdog agency. Because the Treasury Department failed to gather enough information on the flow of money, it ended up taking on risk that should have been shouldered by France and Germany, according to the Congressional Oversight Panel. More»

Fed Duo Sounded Alarm Over AIG 'Gifts' to Banks

Geithner, Paulson face grilling over 'backdoor bailouts' for AIG clients

(NEWSER) - Two Federal Reserve governors expressed their unease about the Fed's rejection of a plan to force big banks to return $30 billion in cash they received from AIG before its bailout in late 2008. The officials warned that the decision to let the banks, including Goldman Sachs, keep the collateral they paid AIG on credit insurance contracts might be "a gift" to the firms, according to documents obtained by the New York Times. More»

NEWS FROM OUR PARTNERS

What is Newser?

Face it: there's too much news. At Newser, we choose the most thought-provoking and entertaining stories from hundreds of US and international sources and reduce them to a headline, picture, and two paragraphs. And we do it 24/7—you can come back morning, noon, night (and in between) for something new that matters. Read less, know more.

Learn more »

Partnering with: Slate

View Newser on the mobile website

Homeowners Need Bailout, Too: FDIC Chief