Paulson resists more government steps in mortgage crisis
By Greg Robb, MarketWatch
Last update: 12:20 p.m. EDT March 26, 2008
WASHINGTON (MarketWatch) -- U.S. Treasury Secretary Henry Paulson continued to argue against more government intervention in the mortgage crisis on Wednesday, saying a cluster of ideas currently floating around would "cause more harm than good."
In a speech Wednesday to the U.S. Chamber of Commerce, Paulson said most of the new ideas circulating on Capitol Hill, which would generally provide taxpayer money to help reduce loan amounts and refinance mortgages at lower rates to keep homeowners from foreclosing, "are not ready for the starting gate."
"Most of the other ideas I have seen...would cause more harm than good," Paulson said in answer to question after his remarks.
Housing market woes have become a key part of the debate among the three remaining presidential contenders and members of Congress are agitating for action ahead of their elections.
It is unclear whether Paulson, a former chairman of Goldman Sachs, has the political insight to counter this momentum.
Indeed, there is a growing chorus of economists who think it would be a good idea for Congress to do more to stem the housing recession. These analysts think the Federal Reserve has been shouldering too much of the burden for reacting to the crisis and believe the central bank cannot push its short-term interest rate target much lower.
