Just heard McCain/Palin townhall speech in Iowa. Palin was received with wild enthusiasm (McCain less so). She mouthed some banalities (hearing her shallow speeches is like hearing nails on chalkboards). But McCain was on today, and proposed some specific solutions to the economic crisis.
- He is calling for the SEC chairman to be fired.
The Chairman of the SEC serves at the appointment of the President and has betrayed the public’s trust. If I were President today, I would fire him.
- He is calling for the creation of the mortgage and financial institutions trust — the MFI.
We cannot wait any longer for more failures in our financial system. Structures like the resolution trust corporation that dealt with the failed savings and loan industry were designed to clean up the system and worked. Today we need a plan that doesn’t wait until the system fails. I am calling for the creation of the mortgage and financial institutions trust — the MFI. The priorities of this trust will be to work with the private sector and regulators to identify institutions that are weak and take remedies to strengthen them before they become insolvent. For troubled institutions this will provide an orderly process through which to identify bad loans and eventually sell them.
This will get the treasury and other financial regulatory authorities in a proactive position instead of reacting in a crisis mode to one situation after the other. The MFI will enhance investor and market confidence, benefit sound financial institutions, assist troubled institutions and protect our financial system, while minimizing taxpayer exposure. Tomorrow I will be talking in greater detail about the crisis facing our markets and what I will do as President to fix this crisis and get our economy moving again.
At first glance, this seems like a proposal similar to the Resolution Trust Corporation formed in the 1980s. From Wikipedia
The Resolution Trust Corporation was a United States Government-owned asset-management company charged with liquidating assets (primarily real estate-related assets, including mortgage loans) that had been assets of savings and loan associations ("S&Ls") declared insolvent by the Office of Thrift Supervision, as a consequence of the Savings and Loan crisis of the 1980s. It also took over the insurance functions of the former Federal Home Loan Bank Board. It was created by the Financial Institutions Reform Recovery and Enforcement Act (FIRREA), adopted in 1989. In 1995, its duties were transferred to the Savings Association Insurance Fund of the Federal Deposit Insurance Corporation.
Between 1989 and mid-1995, the Resolution Trust Corporation closed or otherwise resolved 747 thrifts with total assets of $394 billion. [1]
McCain may change the discussion/dialog with this proposal. Obama needs to propose concrete solutions as well. On the other hand, he is proposing a solution similar to the one created to handle the S&L crisis, to which he is linked via the Keating 5.
What do you all think? Will proposing something concrete help McCain regain some of the footing he has lost in recent days as he appeared totally disconnected from the realities of our economic situation?