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Dear Mr. Kuecker:
I am deeply troubled by the pain this recession is inflicting on the American people. Homeowners are losing homes, communities are losing tax revenue as foreclosures rise, and workers everywhere are losing jobs as businesses struggle to access the credit they need to function. I appreciate hearing your concerns about the government's efforts to stabilize the economy, and I welcome the opportunity to discuss this issue with you.
Stable and secure financial markets are vital to our prosperity. Financial institutions help Americans buy their first home, further their education, and transform an idea into a business. Last year, I supported the Emergency Economic Stabilization Act in order to prevent the financial crisis from collapsing our whole economy. This legislation, signed into law by President Bush on October 3, 2008, authorized the Treasury Department to commit up to $700 billion to financial rescue programs.
It is very important to me that the Treasury Department treat this money - taxpayer money - as an investment which will eventually yield a return. For example, some of the funds have been used to purchase preferred stock in financial institutions, which pays a 5% annual dividend and is best understood as a loan at 5% interest. The Treasury Department is also increasing the flow of credit by purchasing certain types of assets, which will later be sold back into the private sector as the economy recovers.
Supporting the economic rescue package was a very difficult choice for me to make. As a moderate, I am deeply concerned about the risk of increasing the national debt and the burden it will place on future generations.
But these are not normal times. This recession is deeper than past recessions and poses unprecedented risks to the entire economy - not just Wall Street or irresponsible homeowners. Americans everywhere, who did nothing wrong, feel this pain in rising unemployment and terrible losses of their life savings in the stock market.
I certainly understand and respect the views of those opposed to the financial rescue package, but ultimately I believe we must act to turn our economy around and help Americans through these tough times. That said, I will be sure to keep your thoughts in mind as Congress oversees the implementation of the financial rescue and considers any further action to stabilize the economy.
Herb Kohl
United States Senator
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Interesting to see he describes himself as a "moderate".
What part of "you can't spend your way out of debt" do these people not understand?
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