Finally, the text of the proposed Emergency Economic Stabilization Act of 2008 (Adobe PDF) has been released.
Summary as follows:
- The $700 billion would be disbursed in stages, with $250 billion made available immediately for the Treasury’s use.
- Curbs will be placed on the compensation of executives at companies that sell mortgage assets to Treasury. Among them, companies that participate will not be able to deduct the salary they pay to executives above $500,000.
- An oversight board will be created. The board will include the Federal Reserve chairman, the Securities and Exchange Commission chairman, the Federal Home Finance Agency director and the Housing and Urban Development secretary.
- Treasury is allowed the option to take ownership stakes in participating companies under certain circumstances.
- Treasury may establish an insurance program — with risk-based premiums paid by the industry — to guarantee companies’ troubled assets, including mortgage-backed securities, purchased before March 14, 2008.
- One provision requires the president to propose legislation to recoup losses from the financial industry if the rescue plan results in net losses to taxpayers five years after the plan is enacted.
(CNN) — Sens. Barack Obama and John McCain said Sunday they would probably vote for the government’s proposed bailout legislation once they check out the final details.
Congressional lawmakers announced early Sunday they made “great progress” toward reaching a deal on the White House’s proposed $700 billion bailout plan.
Rep. Barney Frank, D-Massachusetts, said the final plan will be a compromise that includes some of the original Bush administration proposals and elements demanded by congressional negotiators.