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NARR: On Tuesday in California, Arizona Republican Senator John McCain said the economy is in a crisis, and it's not difficult to explain why. When too many people assumed the prices of their homes would only go up, a housing bubble developed. Lending institutions made unwise loans, and banks and hedge funds played with the books. McCain wants the nation's big accounting firms to convene a meeting to make their systems more transparent. He also wants the top mortgage lenders to do the same, and pledge their support to help their customers. But it's not the duty of government to bail out everyone, he says.
ACT: MCCAIN: ANY ASSISTANCE FOR BORROWERS SHOULD BE FOCUSED SOLELY ON HOMEOWNERS, NOT PEOPLE WHO BOUGHT HOUSES FOR SPECULATIVE PURPOSES TO RENT OR SECOND HOMES. ANY ASSISTANCE MUST BE TEMPORARY AND MUST NOT REWARD PEOPLE WHO WERE IRRESPONSIBLE AT THE EXPENSE OF THOSE WHO WEREN'T. (0:28)
NARR: Yesterday at Cooper Union in Manhattan, Democratic Illinois Senator Barack Obama called the crisis a recession. He says the country can bring an end to the foreclosure crisis with new legislation from Connecticut Democratic Senator Christopher Dodd, and Massachusetts Democratic Representative Barney Frank. The bill would empower the Federal Housing Administration to help lenders with their problem mortgages. Obama also spelled out six principles of reform - among them closer scrutiny of government loans, and keeping a closer eye on market manipulation. Like McCain, Obama says the government shouldn't help out bad actors.
NARR: BUT THE DODD FRANK PACKAGE IS NOT A BAILOUT FOR LENDERS OR INVESTORS WHO GAMBLED RECKLESSLY; THEY WILL TAKE THEIR LOSSES. IT'S NOT A WINFALL FOR BORROWERS, AS THEY WILL HAVE TO SHARE IN ANY CAPITAL GAIN. INSTEAD, IT OFFERS A RESPONSIBLE AND FAIR WAY TO BRING AN END TO THE FORECLOSURE CRISIS. IT ASKS BOTH SIDES TO SACRIFICE, WHILE PREVENTING A LONG TERM COLLAPSETHAT COULD HAVE ENORMOUS RAMIFICATIONS FOR THE MOST RESPONSIBLE LEADERS AND BORROWERS, AS WELL AS THE AMERICAN PEOPLE AS A WHOLE.
NARR: Democratic New York Senator Hillary Clinton addressed the economic issue early in the week from the University of Pennsylvania. She says she warned the Bush administration a year ago about abuses in the sub-prime market, and how that would affect the whole economy. She also supprts the Dodd-Frank legislation, and presented her own four point plan. It includes appointing an emergency working group on foreclosures and passing new legislation to clarify legal liabilities for mortgage companies. Clinton says the government can't bail out the big firms while the average American suffers.
NARR: WE'VE GIVEN BEAR STEARNS A 30 BILLION DOLLAR LIFELINE WE'VE GIVEN THEIR CREDITOIRS THEIR LENDERS AND THEIR CUSTOMERS THE SAME LIFELINE WE ARE NOE THROUGH THE FEDS CAHANGE IN POLICY LEMDING BILLIONS OF DPLLARS A DAY THAT ARE NOT REGULATED THAT ARENT TRANSPARENT AND NOT ACCOUNTABLE. HOE CAN YOU TELL A FAMILY BABOUT T0O LOST THEIR HOME THAT THEIS NOTHING WE CAN DO TO HELP THEM.
NARR: All of the candidates spoke of transparency- the need for more in the markets and mortgage companies. McCain says he will focus on international affairs in the coming weeks, something both Obama and Clinton would like to do. Only they'll be preoccupied with their next primary battle, April 22nd in Pennsylvania.
SOC: Kyle Murphy, Columbia Radio News