Wherever I travel across Maine, families, small businesses and other hardworking people share with me their anxiety that the growing financial crisis threatens their economic security, their savings, their dreams for their children’s education and their plans for retirement. They are frustrated that the failed policies and negligent oversight of the current administration and its allies in Congress over the last eight years led to this calamity. And many tell me they are angry that the federal government will use their tax dollars to bail out the banks and corporations whose greed and incompetence created this situation. They’ve had enough. They demand change, and they want new leaders who will work for the people on Main Street not the speculators on Wall Street.
As one Hallowell man put it, “I’ve worked my entire life, played by the rules and used to feel like I was getting ahead. Now my paycheck won’t cover the rising cost of fuel, health care, food and other necessities. Where’s my government bailout? Where’s my ‘golden parachute?’”
Last Friday, Treasury Secretary Henry Paulson detailed the urgency of the financial emergency in a conference call with me and some other members of Congress. He was unable to explain why this administration failed to see the handwriting on the wall and act before the situation had deteriorated to the point that our financial system itself was on the verge of collapse.
I was shocked, but not surprised, since this administration inherited the largest federal budget surplus in history and turned it into years of the largest deficits in history. When President Bush took office, the national debt, accumulated over the preceding two centuries of our nation’s history, was $5.7 trillion and on its way down. In less than eight years, and without including the recent proposed bailouts, that figure has increased to more than $9.7 trillion.
This administration’s economic policies have cost more than 3 million manufacturing jobs and have created just 5.6 million new jobs overall — less than a quarter of the 22.7 million jobs created during President Clinton’s eight years in office. The nation’s gross domestic product under George Bush has grown by just 2.6 percent, the worst performance of any administration since 1960, except one — that of President George H.W. Bush.
What have the economic policies of President Bush and his supporters in Congress meant for families in Maine and throughout America? Median income for working age families has actually decreased by $1,100 since 2001. And the cost of fuel, food, health care, college tuition and virtually every aspect of middle-class life has skyrocketed.
And now, in its final months, the administration that mismanaged the conflict in Iraq and the aftermath of Hurricane Katrina will leave the next administration and new Congress a perfect storm of economic chaos, the worst financial disaster since the Great Depression.
One lesson of the Great Depression was that the government’s failure to step in immediately to restore confidence contributed to the collapse of the financial system. We must not repeat that mistake, but, as a price for any bailout, Congress must require transparency and accountability from the executives and companies that enjoyed profits in the boom times and now expect the rest of us to pay the tab for their mistakes. I will work with members of Congress from both parties to minimize taxpayer exposure, conduct rigorous, effective oversight of the Treasury, place limits on excessive compensation for executives and establish safeguards to ensure this never happens again.
My ultimate objective for any federal action will be to protect the economic security of the American people, the families and businesses struggling to get by from Portland, Maine, to Portland, Ore. For eight years, this administration and its supporters in Congress were derelict in their duty to prevent this catastrophe. Their policies have benefited the rich and powerful while ignoring the priorities of the fisherman in Castine, the single mother in Turner, the shop owner in Dexter and working people across Maine and America. It’s time to put the middle class first for a change.
Tom Allen represents Maine’s 1st Congressional District. He is a Democratic candidate for the Senate.