Feb 03 2009
By Kerry Whipple Bean
U.S. Sen. Richard Shelby has a quick answer for what he would do with the proposed stimulus plan - “shelve it” - but admits there are no easy answers to fix the economy.
“We are going through some tough times now,” he said Saturday at a town hall meeting at Brewton's public library. “You can't spend your way or borrow your way to prosperity.”
Shelby, R-Ala., has been opposed to President Barack Obama's stimulus package, a mix of tax cuts and spending measures designed to jumpstart the economy and create jobs.
Rather than pass the stimulus plan, Shelby said elected officials need to get together with top economists to design a plan to restore confidence in the banking system.
“Banks are not loaning money,” Shelby said. “We have a toxic system. It's been a game of passing on the risk - we've got to get back to fundamentals.”
Shelby said Obama's plan would force the United States to borrow up to $3 trillion to fund the spending measures, which include money for schools, infrastructure and other projects across the country. The nation already has $10 trillion in debt, he said.
“I think we have our priorities off,” Shelby said. “We've got to get the banking system in order.”
Shelby said he's not sure what will happen with the stimulus bill, which passed the U.S. House last week, albeit without a single GOP vote. Republicans have 41 votes in the Senate, and Shelby said he thinks one or two GOP senators might vote for the bill.
“If all of the Republicans stay together, we could block it,” he said. “I would shelve it.”
Shelby said he hopes senators don't “rush to judgment” on the stimulus bill, instead taking time to craft a plan that will get private citizens investing and banks lending.
“If we don't bring back confidence, transparency and integrity in the banking system, we're in big trouble,” Shelby said.
Shelby said he reluctantly voted to approve Obama's choice for treasury secretary, Timothy Geithner, despite Geithner's past problems involving failure to pay income taxes and despite Geithner's support last year of the $700 billion banking bailout.
But Shelby, who is the ranking member of the Senate banking committee, said he will ask Geithner this week to demand an accounting of where banks spent the first $350 billion they received under the bailout plan passed last fall, when President George W. Bush was still in office.
“It's your money,” Shelby said to the large crowd at the library. “Don't you think you ought to know where it went?”
If any of the taxpayers' money went to pay bonuses to executives, Shelby said American citizens need to know. “If it was tax money, there ought to be a thorough accounting,” he said.
Last month, Shelby and U.S. Sen. Charles Schumer, D-N.Y., announced that they have introduced legislation to add hundreds of new investigators to financial fraud units to prosecute white collar crimes, particularly those that have contributed to the ongoing financial crisis.