US' $700bn bailout under review
Congress grills architects of $700bn bailout package
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Tuesday, 18, Nov 2008 05:35
US Treasury secretary Henry Paulson and Federal Reserve chairman Ben Bernanke have defended their orchestration of the United States' financial bailout plan.
The plan was being reviewed by the Congressional committee to ensure that the plan took all appropriate actions during the financial crisis.
The $700 billion (£467 billion) package was used to buy shares in the banks and increase their capital to encourage consumer lending.
This conflicted with the original plan that the government would buy up the banks' mortgage debts.
Congress approved the financial plan last month and Mr Paulson warned them it was vital to assess the financial crises and adapt the plan to make correct decisions.
"I think everyone can agree that you wouldn't want taxpayer dollars going to something that would not be a long time concern or something that could actually succeed in the future," a White House spokesman said.
The first $350 billion (£233 billion) pumped into the US economy was not enough, and then the government increased money up to $700 billion, but the economy still needs money.
Barack Obama and the democrats have backed a new bail out plan of $25 billion (£17 billion) for the car industry.
Republicans still believe the credit industries are facing problems and credit companies and non-bank lenders should receive additional financial assistance.