Bush takes victory lap for his "extraordinary measures," says economy will come back in the long run

[Amerigo Vespucci]

Bush: 'Extraordinary' steps won't smother free market
AFP
Published: Wednesday October 15, 2008



President Bush delivers a statement outside the Ada Bike Shop following a meeting with local business leaders in Ada, Mich., Wednesday, Oct. 15, 2008. (AP Photo/Susan Walsh)

http://rawstory.com/news/afp/Bush_Extraordinary_steps_won_t_smot_10152008.html

US President George W. Bush, confronting worries about widening US government sway over banking, said Wednesday that his "extraordinary" actions would save the free market and revive the economy.

"It's very important for the American people to know that the program is designed to preserve free enterprise, not replace free enterprise," he said in a brief public appearance as he opened talks with his cabinet.

He spoke one day after announcing that the government would pump up to 250 billion dollars into banks and offer new guarantees to help restore credit flows -- the latest effort in the battle against a loss of global confidence.

Nine large banks, including Citigroup, JPMorgan Chase and Goldman Sachs, agreed to give the government stakes in exchange for new capital, as the US partly nationalizes banks for the first time since the Great Depression.

"We have taken extraordinary measures, because these are extraordinary circumstances," the US president said. "I am confident in the long run, this economy will come back."

Bush's message to the jittery US public and global markets in upheaval came as some critics, notably on the right flank of his Republican party, warned against what they charge is excessive government intervention in the market.

"There won't be government officials sitting on the board of private companies," he promised. "These banks will be privately controlled. The liquidity measures being taken are structured such that the government will be a passive investor."

With US Secretary of State Condoleezza Rice and US Treasury Secretary Henry Paulson on either side of him, Bush also promised that the government buy-up of stakes in the banks was "a temporary decision" because the government would eventually sell back its holdings to the banks.

"These are extraordinary measures, no question about it. But they're well thought out. They are necessary. And I am confident in the long run, this economy will come back," Bush said.

"The American people must understand that this carefully structured plan is aimed at helping you. If I'd have thought this situation would have been contained only to Wall Street, we'd have had a different response," he said.

"But in our judgment, had we not acted decisively at the time we did, the credit crunch, the inability for banks in our communities to loan to your businesses would have affected the working people and the small businesses of America,"

"And that's unacceptable to me, and it's unacceptable to this cabinet," Bush said.

US banks will have an option to join the nine major lenders in the capital infusion program, in which the government gets "senior preferred shares" which would be "non-voting" except to protect investment rights, according to a Treasury statement.

Banks in the program will agree to limits on executive pay and other benefits.

In a related move, the government will also temporarily guarantee bank debt that includes interbank funding and offer unlimited deposit insurance for many accounts as part of a stepped-up global effort to stem a credit crunch.

Officials also said that the Federal Reserve would soon act as the "buyer of last resort" for commercial paper -- short-term corporate debt that is critical for financial markets and companies needing cash for operating expenses.

[Solly Mack]

1. Last time he talked of "extraordinary measures" he implemented a torture policy

and was kidnapping people...

[Jack Rabbit]

2. It will be back

It might take eight or ten years this time, but it will be back.

I guess if Bush can still blame Clinton for all his problems today, he can take credit for everything that goes right under the Obama administration.

[Rob H.]

3. "The American people must understand..."

I fucking hate it when he starts sentences like that. There are few things more annoying than being lectured at by a jackass who couldn't find his ass with both hands, a Sherpa guide, a bloodhound, and a GPS tracking system. The only people even dumber than Bush are the backwashers who still support that imbecile.

:rant: