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Sen. James Inhofe, R-Okla., revealed on “The Pat Campbell Show” on 1170 KFAQ, a talk radio station in Tulsa, Okla., where some of these ideas in Congress may have originated. He divulged details of a conference call with Treasury Secretary Henry Paulson from mid-September, which may be behind why some members of Congress were warning of catastrophe.
“We had a conference call early on,” Inhofe said on Nov. 18. “It was on a Friday I think – a week and half before the vote on Oct. 1. So it would have been the middle … what was it – the 19th of September, we had a conference call. In this conference call – and I guess there’s no reason for me not to repeat what he said, but he said – he painted this picture you just described. He said, ‘This is serious. This is the most serious thing that we faced.’”
According to Inhofe, Paulson said this would be far worse than the Great Depression - a time when unemployment was at 24.9 percent and U.S. gross domestic product (GDP) suffered steep declines.
“He said, ‘This is going to be far worse than the Great Depression in the ’30s,’” Inhofe said. “And all these things – he was very descriptive of exactly what would happen if, if we didn’t buy out these toxic assets which he abandoned the day after he got the money.”
However, nearly a month and a half later, Paulson changed course on his bailout plan. Instead of buying up troubled assets as he originally proposed, the former head of the investment bank Goldman Sachs (NYSE:GS) announced on Nov. 12 the Treasury would instead on injecting capital directly into banks, upsetting some lawmakers in Congress. Paulson had to defend this decision before the House Financial Services Committee on Nov. 18.
http://www.businessandmedia.org/arti...119073313.aspx
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