Around Town : Restoring economic security for Arkansans
Posted on Wednesday, October 8, 2008
For the past few weeks, we have been witness to extraordinary events in our financial markets and an equally unparalleled response from Congress. Our lawmakers have been working long hours in an attempt to intervene and prevent a looming financial meltdown that virtually all economists agree could be of epic proportions. Like many of you, I am outraged by the unchecked excesses and dubious practices of Wall Street that contributed to our current economic paralysis. I believe that the CEOs and financial institutions, whose irresponsibility and greed created this mess, must not be rewarded with a blank check or a golden parachute, courtesy of the American taxpayer.
But I am also convinced that the greater risk to our nation lies in simply allowing Wall Street to continue, like it's business-asusual, while the pensions and 401 ks of hardworking Americans diminish before their eyes, and while middle-class families face increasing home foreclosures and the inability to get the loan to send their kids to college. Inaction is not an option in these perilous days, as the risk could be catastrophic - a financial Pearl Harbor.
The bottom line is that action was needed not just to stabilize a faltering Wall Street, it was needed to help out folks on Main Streets all across Arkansas, as well. The stock market reacted to the latest round of impropriety in the financial markets by going on a rollercoaster ride that jeopardized the pensions and retirement funds of millions of Arkansans.
And while that's bad enough, it is not just a matter of our financial markets, the availability of credit, which is one of the fundamental underpinnings of our economy, is also taking a beating. And this affects us all. The freeze on channels of credit that we see beginning to take hold affects all of us in fundamental ways - from the ability to secure a loan for new home ownership or to pay employees, down to loans we take for granted, like buying a used car to be able to get to work. Similarly, small businesses across the state cannot continue to be the backbone for our economic development if startup capital is unavailable and if companies no longer have access to the financing they need to help expand and grow.
We should have no illusions that the legislation passed by Congress will totally remedy the underlying troubles in our economy. The present crisis has exposed troubling lending practices entrenched within the industry, and we are suffering from financial excesses that have gone unchecked for far too long. But the present action should not be seen as a permanent intervention into the free market, rather, it is an essential readjustment by the federal government to stabilize the market in the short-run and avert total economic paralysis. By infusing capital back into our credit system, Congress can stop the financial bleeding and get the market back on its feet, so that we can begin to formulate a comprehensive approach to restore confidence in our financial markets and address the deeper issues within our housing and credit markets.
I was proud to see the members of our Arkansas congressional delegation come together across party lines to focus on efforts to protect the economic security of all Arkansans and the nation. In the face of a financial catastrophe, now is not the time for partisan bickering and fingerpointing - now is the time for leadership.
None of the elected leaders from Arkansas in Congress backed down from an unpopular fight; they stood up and fought throughout the week to craft a solution that better served the public interest. I was glad to see measures added to improve the bill and address some of the issues that the public overwhelmingly demanded - from practical oversight and reporting requirements, to limitations on executive compensation and a prohibition on "golden parachutes"for CEOs. It's not a perfect solution, I know. But these are unprecedented events that require an immediate and decisive response to prevent our country from slipping into even further fiscal distress. Your Arkansas leaders in Washington put politics aside in order to protect the economic security of everyday Arkansans, and for that, I applaud them.
Arkansas Gov. Mike Beebe can be reached at State Capitol, Little Rock, AR 72201 or telephone (501 ) 682-2345.
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