Jeb in the News

In the Know

U.S. Representative Offers Update on Economy

When U.S. Rep. Jeb Hensarling offered a legislative update Wednesday at the Athens City Hall Annex, people listened.

Lots of people.

Before an overcrowded council chamber packed with 71 people — with several leaning in doorways to hear his comments, Hensarling touched on the current state of the U.S. economy and offered possible solutions to turn the crisis around.

“It is a challenging time in Washington. A lot has happened the last few weeks in Congress,” he said. “I need not tell you we are in very challenging economic times. I believe we are in a recession. I think there is a way out of it and things we can do.”

Hensarling said he never believed inaction was on option during the credit crisis. He twice voted against the proposed bailout bill, saying it essentially gives a $700 billion blank check to the U.S. treasury secretary.

“This problem that began on Wall Street quickly moved to Main Street,” Hensarling said. “But I never believed the Paulson (Henry, the U.S. treasury secretary) plan should have been the only one debated.”

Hensarling said he views the plan as more of a bailout than a workout.

“I am heartened by the fact that the bill has been made better due to the efforts of House conservatives,” he said.

The measures introduced into the bill by conservatives include limiting compensation for executives of troubled firms seeking money from taxpayers, raising FDIC insurance limits and revising mark-to-market rules, according to Hensarling.

He said he fears the bill will set a dangerous precedent and change the role of government in a free market economy.

“I wanted to be very careful while addressing this financial crisis to ensure that any short-term gain does not come at the cost of even greater long-term pain — that being the slippery slope to socialism,” Hensarling said. “The thought of my children growing up in America with less freedom and less opportunity is a long-term pain I cannot bear. That is why I cast a ‘no’ vote twice, but I did so with some doubt.”

He said House conservatives were willing to be flexible and negotiate. Hensarling said he worked to increase the flow of voluntary capital into the markets from investors by suspending capital gains taxes for two years, rather than involuntary capital from taxpayers.

“That is not the law of the land today,” he said. “I will do everything I can to make the (Paulson) plan work. It doesn’t seem the Dow Jones put the welcome mat out.”

The Dow fell 875 points Monday and Tuesday combined before losses were limited to 189 points Wednesday.

Hensarling said the moratorium on drilling on most of the Outer Continental Shelf and on oil shale leasing on federal land expired on Oct. 1.

“I think that even though the actual supply is years away, it signals to the market that supply is on the way,” he said.

Hensarling said the price of crude oil in the futures markets will lower and the price at the pump will then follow.

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