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Wednesday, October 1, 2008

Senator Barack Obama on the bailout

Below is the full text of the remarks of Senator Barack Obama, as prepared for delivery on the Senate floor today. Senator Obama voted yes to approve the bailout.

WASHINGTON, D.C. - U.S. Senator Barack Obama today made the following statement on the Senate floor on the Emergency Economic Stabilization legislation (H.R. 1424), which is being voted on in the Senate later this evening:

As prepared for delivery:

"The fact that we are even here voting on a plan to rescue our economy from the greed and irresponsibility of Wall Street and Washington is an outrage. It is an outrage to every American who works hard and pays their taxes and is doing their best every day to make a better life for themselves and their families. They are angry that Wall Street's mistakes have put their tax dollars at risk, and they should be. I am too.

But while there is plenty of blame to go around and many in Washington and on Wall Street who deserve it, all of us - all of us - have a responsibility to solve this crisis because it affects the financial well-being of every single American. There will be time to punish those who set this fire, but now is the moment for us to come together and put the fire out.

When the House of Representatives failed to act on Monday, we saw the single largest decline of the stock market in two decades. Over one trillion dollars of wealth was lost by the time the markets closed. And it wasn't just the wealth of a few CEOs or Wall Street executives. The 401Ks and retirement accounts that millions count on for their family's future became smaller. The state pension funds of teachers and government employees lost billions upon billions of dollars. Hardworking Americans who invested their nest egg to watch it grow saw it disappear.

But while that decline was devastating, the consequences of the credit crisis that caused it will be even worse if we do not act now.

We are in a very dangerous situation where financial institutions across this country are afraid to lend money. And if all that meant was the failure of a few big banks on Wall Street, it would be one thing.

But that's not what it means. What it means is that if we do not act, it will be harder for Americans to get a mortgage for their home or the loans they need to buy a car or send their children to college. What it means is that businesses won't be able to get the loans they need to open new factories or make payroll for their workers. And if they can't make payroll on Friday, then workers are laid-off on Monday. And then those workers can't pay their bills or pay back their loans to someone else. And it will go and on and on and on, rippling through the entire economy. Thousands of businesses could close. Millions of jobs could be lost. A long and painful recession could follow.

This is not just a Wall Street crisis - it's an American crisis, and it's the American economy that needs this rescue plan. I understand why people would be skeptical when this President asked for a blank check to solve this problem. I was too, and that's why over a week ago, I demanded that this plan include specific proposals to protect the American taxpayer - protections that the Administration eventually agreed to, as well as Democrats and Republicans here in the Senate and over in the House.

First, I said we needed an independent board to provide oversight and accountability for how and where this money is spent at every step of the way.

Second, I said that we cannot help banks on Wall Street without helping the millions of innocent homeowners who are struggling to stay in their homes. They deserve a plan too.

Third, I said that I would not allow this plan to become a welfare program for the Wall Street executives whose greed and irresponsibility got us into this mess.

And finally, I said that if American taxpayers are financing this solution, then they should be treated like investors - they should get every penny of their tax dollars back once this economy recovers.

This last part is important, because it's been the most misunderstood and poorly communicated part of this plan. This is not a plan to just hand over $700 billion of taxpayer money to a few banks. If this is managed correctly, we will hopefully get most or all of our money back, or possibly even turn a profit on the government's investment - every penny of which will go directly back to the American people. And if we fall short, we will levy a fee on financial institutions so that they can repay us for the losses they caused.

Even with all these taxpayer protections, this plan is not perfect. Democrats and Republicans in Congress have legitimate concerns about it. I know many Americans share those concerns. But it is clear that this is what we must do right now to prevent a crisis from turning into a catastrophe. And to the Democrats and Republicans who have opposed this plan, I say - step up to the plate and do what's right for the country, because the time to act is now.

I know many Americans are wondering what happens next. Passing this bill cannot be the end of our work to strengthen our economy - it must be the beginning.

As soon as we pass this rescue plan, we need to move with the same sense of urgency to rescue families on Main Street who are struggling to pay their bills and keep their jobs. I've said it before and I'll say it again: we need to pass an economic stimulus plan that will help folks cope with rising food and gas prices, save one million jobs by rebuilding our schools and roads, and help states and cities avoid budget cuts and tax increases. A plan that would extend expiring unemployment benefits for those Americans who've lost their jobs and cannot find new ones.

We also must do more than this rescue package does to help homeowners stay in their homes. I will continue to advocate bankruptcy reforms to help families stay in their homes and encourage Treasury to study the option of buying individual mortgages like we did successfully in the 1930s. Finally, while we will all hope that this rescue package succeeds, we should be prepared to take more vigorous actions in the months ahead to rebuild capital if necessary.

Just as families are planning for their future in tough times, Washington will have to do the same. Run-away spending and record deficits are not how families run their budgets, and it can't be how Washington handles people's tax dollars. It's time to return to the fiscal responsibility we had in the 1990s. We need to go through the budget, get rid of programs that don't work and make the ones we do need work better and cost less. With less money flowing into the Treasury, some useful programs or policies might need to be delayed in the years ahead.

But there are certain investments in our future that we cannot delay precisely because our economy is in turmoil. We cannot wait to help Americans keep up with rising costs and shrinking paychecks by giving our workers a middle-class tax cut. We cannot wait to relieve the burden of crushing health care costs. We cannot wait to create millions of new jobs by rebuilding our roads and our bridges and investing in the renewable sources of energy that will stop us from sending $700 billion a year to tyrants and dictators for their oil. And we cannot wait to educate the next generation of Americans with the skills and knowledge they need to compete with any workers, anywhere in the world. Those are the priorities we cannot delay.

I won't pretend this will be easy or come without cost. We will all need to sacrifice and we will all need to pull our weight because now more than ever, we are all in this together. What this crisis has taught us is that at the end of the day, there is no real separation between Main Street and Wall Street. There is only the road we're traveling on as Americans - and we will rise or fall on that journey as one nation; as one people.

I know that many Americans are feeling anxiety right now - about their jobs, about their homes, about their life savings. But I also know this - I know that we can steer ourselves out of this crisis. We always have.

During the great financial crisis of the last century, in his first fireside chat, Franklin Roosevelt told his fellow Americans that "..there is an element in the readjustment of our financial system more important than currency, more important than gold, and that is the confidence of the people themselves. Confidence and courage are the essentials of success in carrying out our plan. Let us unite in banishing fear. Together, we cannot fail."

We cannot fail. Not now. This is a nation that has faced down war and depression; great challenges and great threats. And at each and every moment, we have risen to meet these challenges - not as Democrats, not as Republicans, but as Americans. With resolve. With confidence. With that fundamental belief that here in America, our destiny is not written for us, but by us. That's who we are, and that's the country I know we can be right now.

I want to thank the extraordinary leadership of Chairman Dodd and the Banking Committee as well as Chairman Baucus and Majority Leader Reid. I also want to thank the leadership in the House of Representatives.

I urge my colleagues to join me in supporting this important legislation."


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