(Host) Congressman Peter Welch says the federal government must continue to take an active role to help restore consumer confidence in the economy.
Welch says he supports the idea of allowing the Treasury Department to take a partial ownership stake in a number of private banks, to help open up national credit markets.
VPRs Bob Kinzel reports:
(Kinzel) Welch readily acknowledges that there’s no single solution to solving the country’s economic crisis.
He argues that the $700 billion rescue package that was passed by Congress last week is only the first step to help strengthen the national economy.
Speaking on VPRs Vermont Edition, Welch said this is a time for the federal government to experiment with many different approaches to help deal with the current financial crisis:
(Welch) "We’re going to be struggling frankly to figure out how to address this but I do believe there has to be active engagement, experimentation almost like FDR we try something it works keep doing it if it doesn’t work change it."
Welch says he supports efforts to allow the federal government to inject cash directly into major banks to help reduce credit concerns – in return, the government would get an equity position in the banks.
Welch says last week’s bail out bill gives the Treasury Department the authorization to take this step:
(Welch) "One of the ways that we put in the bill so that can happen is some authority to do this direct purchase that gets the asset base of these institutions up quickly so that they are in a position to start lending it’s what England did and what Sweden did several years ago when they had a similar crisis."
Welch says he’s also encouraging House Speaker Nancy Pelosi to bring Congress back in a special lame duck session after the November election to consider a second economic stimulus package:
(Welch)"Where we use some traditional methods to try to return employment to the economy and the focus of that should be roads and bridge repair infrastructure it should be putting money into energy development and it should be helping the states with their burden on Medicaid expenses so that we can take some pressure off the state taxpayer."
Welch says he’d also like to see Congress support a plan to impose a new surcharge on stock transactions as a way to make certain that taxpayers don’t get stuck with the bill for the new bail out law.
For VPR News I’m Bob Kinzel in Montpelier.