President Bush's Speech
Club for Growth Statement on President Bush Speech
Congress Should Say No to a Bailout
Washington – Club for Growth President Pat Toomey released the following statement on President Bush’s speech on the economy:
“We understand the political temptation to take quick and decisive action, but a multi-hundred billion dollar taxpayer-funded bailout is the wrong answer. President Bush is predicating the need for a government bailout on the assumption that the credit markets are ‘frozen,’ but we see no evidence of a general freezing of credit markets. As Robert Higgs of the Independent Institute reports on the St. Louis Fed’s data, total outstanding bank credit is at or near record highs. While certainly some financial institutions are under great stress, eighteen months into this financial crisis their problems have not spread widely. The economy continues to grow; productivity growth is strong; and unemployment, while increasing, is not close to levels it has routinely reached in past recessions.”
“The bailout plan is fundamentally unfair to American taxpayers and responsible borrowers and lenders. The bailout misallocates capital, risks massive inflation, invites political manipulation, and sets a bad precedent for future bailouts down the road. Already we are witnessing other industries lining up for their share of the government’s handouts.”
“Instead of acting rashly, Congress needs to take a deep breath and enact pro-growth policies like a stable dollar policy and lower taxes on capital gains and corporate income. In addition, mark-to-market accounting for banks should be suspended and Congress should implement an expedited Chapter 11 process for financial institutions that become insolvent. We encourage all members of Congress to reject a massive bailout plan.”
