Washington, D.C. -- The U.S. House of Representatives continues debate this evening on a $700-billion financial rescue plan aimed at keeping some of the country’s largest Wall Street banking and investment firms solvent and able to maintain credit lines to smaller banks and financial institutions

“The original White House bailout plan unveiled last week was nothing more than the Bush Administration’s gift of $700-billion in public funds to the same Wall Street bankers and investors who caused the financial meltdown in the first place,” said Representative Neil Abercrombie.  “However, the public demanded a very different $700-billion financial rescue plan.  Overwhelming outrage at the idea of using public funds to save Wall Street from its own greed and bad decisions forced major changes in the plan, including real elements of accountability and responsibility.”
 
Negotiating through the weekend, Democratic Congressional leaders and House Republicans have insisted on changing the entire nature of the plan. Under the final agreement:
• An oversight board will be created, including the Federal Reserve chairman, the Securities and Exchange Commission chairman, the Federal Home Finance Agency director and the Housing and Urban Development secretary;

• Holders of the “distressed” mortgage-backed securities will be encouraged to use government insurance to cover defaulted loans instead of public funds;

• Taxpayers will be able to recover most or all of the public funds money through the later sale of secured loans, and the government would receive stock warrants in return for the bailout relief, giving taxpayers a chance to share in financial companies' future profits;

• There are reasonable limits on severance packages and bonuses for the executives of companies that benefit from the plan;

• The financial sector will help make up the difference if the government does not recoup its investment in five years; and

• To help struggling homeowners, the plan would require the government to try renegotiating the bad mortgages it acquires with the aim of lowering borrowers' monthly payments so they can keep their homes.

“I was struck by the interest and thoughtful comment offered by the people of Hawaii in the last few days,” continued Abercrombie, who has used his Congressional web site as an information resource for the public, posting summaries, statements and news articles about the various proposals under consideration.  “I asked Hawaii residents to give me their opinions and they did.  Nearly 1,000 people called or emailed my offices over the last five days to share their views.  As I read through the 106-page bill tonight and tomorrow, I’ll keep the many comments I’ve received in mind.”

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