Frosh Dem Gillibrand explains nay vote

The New York rookie says it's not up to taxpayers to correct Wall Street excesses.

Published September 29, 2008 8:12PM (EDT)

It's impossible to say for sure if New York rookie Rep. Kirsten Gillibrand's attitude is representative of all those nay-voting Democrats, or even the frosh cohort among them, but here's her explanation for her vote*:

While I am fully aware of the seriousness of the financial problems in the market, I do not believe the bill Congress voted on today was the right approach. The bill has insufficient oversight and protections and does not address the root causes of the crisis or the poor economy.

While the bill is better than the three page document the Bush Administration tried to ram through Congress last week, Secretary Paulson's plan is fundamentally flawed. Moreover, I do not believe Upstate New York taxpayers should pay for the excesses of Wall Street ...

We need to help firms recapitalize, and this should be done without solely using taxpayer money. The federal government should work with firms to accurately write down the values of these assets in order to restore confidence in the system and allow investors to begin buying and selling again. Firms should be required to raise their capital standards, and if the federal government needs to intervene, then they should receive a fair equity stake in the company in order to protect the taxpayer. If taxpayer funds are invested, then we would need much stricter executive compensation limits, so that Wall Street executives are not financially rewarded for the crisis they have created. To calm fears, we should raise the FDIC insured limits. Furthermore, we need to put in place regulatory measures that will prevent this type of economic meltdown in the future, so that the middle class' savings will not be threatened again because of Wall Street mismanagement and greed.

*Thanks to superb, Albany-based blogger Andrew White for getting this statement circulated.

Update; Here is part of a statement from non-frosh, Senate-seat-seeking Rep. Tom Udall of New Mexico, echoing Gillibrand: "I cannot in good conscience vote for a rushed $700 billion taxpayer-funded bailout to shore up Wall Street while ignoring our middle class and the nation's underlying economic flaws that caused this crisis in the first place. I will, however, continue fighting to do what's right and fix our financial markets to prevent similar crises from occurring again." Udall, incidentally, isn't in any serious trouble with regard to winning in November.

By Thomas Schaller

Thomas F. Schaller is professor of political science at the University of Maryland, Baltimore County and the author of "Whistling Past Dixie: How Democrats Can Win Without the South." Follow him @schaller67.

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