Bush offers possible financial solution

Friday, September 19th 2008, 7:17 pm
By: News 9

By Jon Jordan, NEWS 9

The President announced a plan Friday he said should help to correct the current U.S. financial crisis.

Part of the solution involves the government stepping in and buying up all of the banks' bad debt.

Some say to buy up all bad debt could cost the government as much as half a trillion dollars; money that will have to come from taxpayers.

Pulling no punches, the President made it clear Friday, to fix the current economic crisis, it's going to take a tough solution.

"America's economy is facing unprecedented challenges, and we're responding with unprecedented action," President Bush said.

The unprecedented measures could become one of the biggest government interventions in America's financial system ever; an intervention that will come at the tax payer's expense. Despite that, it's a solution Vince Orza, the Dean at the Meinders School of Business at Oklahoma City University, said has to happen.

"The government had been fighting this like a brush fire, one here, one here," Orza said. "Now, they have a systematic, or at least the plans for, a systematic approach to stabilizing the banking community."

However some analysts are said it could cost as much as $500 billion in taxpayer money, and when you take the estimated 135 million taxpayers in the U.S, broken down, each taxpayer could be looking at having to contribute nearly $4,000. The $4,000 per taxpayer could cause a problem for some Oklahomans.

"The government is very quick to bail out the big companies, the savings and loans administrations, but the individuals, I still have to pay my bills," Oklahoman Latrice Spencer-Henderson said. "If I can't pay my bills I've got to pay them, nobody is bailing me out."

"I don't like it that they're using tax payer money cause I don't think it's pointing to the problem," Oklahoman Jeff Walizer said.

Despite the large amount of tax dollars involved, should things improve, it is possible taxpayers could get their money back.

"If we stabilize the banking markets so that housing prices stabilize and perhaps begin to rise again, it's not out of the question that at some point this could be a money making proposition for the government," Orza said.

This is still only a plan, it still needs approval from Congress, but the President did say he's hopeful Democrats and Republicans will be quick to get on board. However, there have been officials on both sides who are opposed to the idea of bailing out the banks.

So far, the markets have responded favorably to the possibility of the government stepping in.