Chairman of the House Financial Services Barney Frank (D-Mass.) explains the functions of the bailout bill and what will happen once Treasury Secretary Henry Paulson uses almost $700 billion to buy mortgage-backed securities and what the “strange hope” that the U.S. taxpayer should have for those holdings. (1:10)
Speaker of the House Nancy Pelosi (D-Calif.) says that the bailout bill that passed the House was about restoring confidence to the U.S. financial market. (1:05)
Chairman of the House Financial Services Committee, Barney Frank (D-Mass.) says that elected officials shouldn’t be asked to do work that is apolitical. (0:45)
Somewhere in the days between the Jewish holidays of Rush Hashana and Yom Kippur, the Yamim Noraim, the days of awe, the House of Representatives passed one of the most politically divisive bills of the congressional session. The hotly contested and revised bailout bill passed the House 263 to 171.
Congressional Democrats thanked each other and their presidential candidate Sen. Barack Obama minutes after the bill was passed. Rep. Jim Clyburn (D-S.C.) said that he hoped the act would restore as much confidence to the market as it did to the body politic. “It is an exclamation mark on a successful Congress,” Clyburn said.
Clyburn and the Democratic leadership, including Speaker Nancy Pelosi, Majority Leader Steny Hoyer, and the caucus chair Rahm Emmanuel applauded House Financial Services Chairman Barney Frank (D-Mass.) for the work of his committee in revising the bills. The bailout had failed to garner enough votes just four days earlier. Since Monday provisions were added to the House bill to protect homeowners facing foreclosure and protect tax payers’ investment. The bill created a fee for Wall Street to cover government costs if the assets the Treasury plans to purchase do not yield a high return. Additionally tax equity for these returns and the alternative minimum tax.
In a flurry of metaphors House Democrats said that while this bill has stemmed financial panic and restored calm to the markets but that further changes in regulation will be necessary in the next White House and in the new Congress.
The McCain-Palin campaign held a conference call to discuss their pullout from Michigan and other issues. (17:55)
House Majority Leader Steny Hoyer (D-Md.) likened the U.S. financial crisis to a hurricane saying that if any bailout bill passes the House it will be “the eye of the storm.” He recalled the scenes of devastation left by the recent powerful storms Ike and Katrina, saying that if emergency bailout legislation does not pass there will be broad damage nationwide.
Hoyer began his regular sit down with reporters by summing up the changes made to the bailout bill since it failed to pass in the House on Monday. Hoyer said that the new bill had more transparency and oversight including a congressionally-appointed oversight board. There have also been taxpayer protections added to the legislation. One of these provisions will give equity in any potential payback to the residents of all states equally. There is also an outline for assessment of how the government-owned assets are doing in the market. After five years out, if these mortgages and mortgage-backed securities have not yielded significant returns a fee will be paid by the financial industry at large to cover the government’s costs. Hoyer also reassured the press that the portions of struggling companies that the federal government plans to buy will not involve them in any voting on company boards, “We are not going to get into the business of the government running private companies,” Hoyer said.
Hoyer said that while calls to his congressional office continue to have three to one of constituent callers against the bailout, the number has gone down from six to one early in the week. Hoyer said people saw the effect of the bill’s failure on the state of the market. The significant loss caused people to recognize the downside of not passing some kind of financial intervention. “People saw on Monday the direct impact on them,” he said. “Then the wind started to whip up on this hurricane.”
The Democratic leader said he didn’t expect a vote on this legislation until Friday, as he said there are still discussions of add-ons including increased unemployment insurance, which Republicans oppose. He said that the House continues to listen to constituents. “Most people say we need to act,” Hoyer said. ” But they are not sure what we need to do. Which would put them in the same position as the Congress.”
The commander of the International Assistance Force in Afghanistan wants it known– Afghanistan is not Iraq.
“I find it sometimes, not very helpful to compare Iraq and Afghanistan. I think they are two very different environments,” said Gen. David McKiernan during a press briefing at the Pentagon.
McKiernan has been the ISAF commander for four months at a time when political attention seems to be returning to Afghanistan. “The environment there is even more complex than I would have thought prior to my arrival. It’s complex in terms of geography, it’s complex in terms of demographics, of resources, or more specifically the lack of resources…the lack of the availability of people who can provide governance in Afghanistan…”
There is a growing acknowledgement in the U.S. government and the Department of Defense that there can not be a solution in Afghanistan without addressing growing problems with terrorism and unrestrained lawlessness in the tribal areas of Pakistan. McKiernan said that the heaviest fighting in Afghanistan is along the border regions with Pakistan, in Regional Commands East and South. “We’re at a higher level of violence this time this year than we were last year. In the east and south we are seeing a greater amount of insecurity in certain areas…The idea that it might get worse before it gets better is certainly a possibility in Afghanistan.”
In eastern Afghanistan, McKiernan reported violence is up and there has been an increase in foreign fighters. Because of this change, McKeirnan said, “the additional military capabilities that have been asked for are needed as quickly as possible.” McKiernan has asked for four brigade combat teams, including enabling parts such as helicopters and logistics support for Afghanistan, adding to the request made by his predecessor Gen. Daniel McNeil.
The Secretary of Defense Robert Gates recently testified to the Senate Armed Services Committee that three to four additional combat brigade teams may be deployed to Afghanistan in the summer of 2009.
McKeirnan said that because of the nature of the conflict in Afghanistan he can’t define what success should look like. “It’s important that winning is seen in Afghan terms,” he cautioned. “Winning in Afghanistan is about the future of the Afghan government and it’s about extending the authority of a legitimate Afghan government that meets the needs the meets of the people there. It’s not about the future of NATO. It’s not about any coalition success. It’s about Afghans.”
The interrogation techniques used against detainees in Guantanamo Bay and Iraq, including those that lead to the prisoner abuse at Abu Ghraib, originated from a Joint Personnel Recovery Agency (JPRA) program that trained U.S. military personnel in resistance to torture known as Survival Evasion Resistance and Escape (SERE) .
“Deputy General Counsel for Intelligence [for the Defense Department] Richard Shiffrin called and asked for a list of psychological and physical pressures used in SERE training..JPRA provided a list of techniques that included stress position, waterboarding, slapping, sleep disruption, and sensory deprivation,” said Senator Carl Levin (D-Mich).
“Mr. Shiffrin testified that part of the reason the general counsels office sought the information was its interest in reverse engineering the techniques for use offensively in detainee interrogations.”
Colonel Steven M. Kleinman, who spent a substantial portion of his career focusing on interrogation and human intelligence, said that this approach did not work properly. The SERE model was based on combatting a Cold War method that was designed to aid in the creation of propaganda and not the eliciting of information.
“Our approach to interrogation has failed to keep pace with our understanding of the operation environment and behaviorial sciences. Interrogation continues to be viewed as a relatively simple task that can be assigned to our most junior personnel,” said Kleinman.
Pentagon spokesman Geoff Morrell explains that the Defense Department budget is usually unaffected by fluctuations of the market as Congress has always supported the Department in passing their budget. (0:41)
Pentagon press secretary Geoff Morrell says that the U.S. military in Afghanistan is seeking more leverage to go after “kingpins” and “large labs” that use Afghanistan’s huge poppy crop to make heroine. (0:50)
