海角大神

Here are some of the things we learned at the Senate Banking Committee鈥檚 big hearing Tuesday on the Bush administration鈥檚 proposed bailout of the US finance system:

1. Treasury Secretary Henry Paulson is fine with oversight after all. The three-page outline of proposed actions the White House sent Congress last weekend contained nothing of the sort. But that does not mean he wants to act as the unfettered bailout czar of America, Secretary Paulson hastened to tell senators. He had just thought it would be 鈥減resumptuous鈥� to tell Congress how to do its oversight job.

鈥淲e need oversight . . . we need transparency. I want it, we all want it,鈥� said Paulson.

2. Congress wants to ding some Wall Street executives, as an inspiration to the others. Paulson and Federal Reserve Chairman Ben Bernanke said they shared lawmakers鈥� outrage, but that punitive actions against Masters of the Universe might discourage them from joining the rescue program. Committee chairman Sen. Christopher Dodd (D) of Connecticut responded that that was just tough.

鈥淎lmost any plan we talk about is going to deal with executive compensation,鈥� he said. 鈥淐ount on it.鈥�

3. The administration wants all its bailout money up front. At one point, Sen. Charles Schumer (D) of New York suggested that maybe it would be prudent for Congress to approve authority for bailout money in batches. Would Paulson be OK with just, say, $150 billion to start?

No, he would not. That would be a 鈥済rave mistake,鈥� said the Treasury secretary. The markets might interpret a constrained bailout as no bailout at all.

4. Taxpayers may get a return of some sort on their $700 billion. The bailout fund will be used to buy distressed assets that are now trading at fire sale prices, said Bernanke and Paulson. In the end, the plan is to hold them and, once prices stabilize, sell them back into the private market.

鈥淭here鈥檚 going to be a substantial amount of recovery. Whether it鈥檚 the full amount is hard to know,鈥� said Bernanke.

5. Nobody appears to know exactly how this is going to work. In particular, there鈥檚 as yet no specific plan about how to find the price the government should pay for assets that at the current moment no one else will touch.

If the US pays too little, the selling institution won鈥檛 get the support it needs, pointed out Sen. Robert Bennett (R) of Utah at one point. If it pays too much, there will not be any upside for taxpayers when the government itself finally sells them off.

鈥淵ou have defined the problem,鈥� said Paulson. 鈥淲e believe we are going to get the right group of experts and come up with a solution.鈥�

Any experts out there got their own solution?