Our guest blogger is Ed Paisley, Vice President for Editorial at the Center for American Progress Action Fund.
As an addendum to The Wonk Room’s National Security Debate Study Guide (pdf), here are six questions that need to be asked at tonight’s presidential debate:
1. Sweeping financial deregulation pushed by conservatives in Congress over the past decade alongside gross supervisory mismanagement by the Bush administration and their appointees at key financial regulatory agencies now requires a $700 billion taxpayer bailout of Wall Street financial institutions to avoid a global financial meltdown.
QUESTION: How will you restore prudent supervision so that foreign investors regain confidence in our financial markets?
2. Overseas financial institutions and investors were sold hundreds of billions of dollars worth of mortgage-backed securities over the past eight years, much of which is now worth substantially less in value due to the failure of the Bush administration both to prevent the origination of bad loans by unscrupulous mortgage brokers and to police the packaging of these mortgage-backed securities by Wall Street into supposedly AAA-rated bonds.
QUESTION: How will you reform the U.S. mortgage marketplace so that foreign investors once again have confidence to invest in the U.S. housing market, and what steps will you take to ensure that new mortgage-backed securities are accurately valued by Wall Street issuers of these bonds?
3. The U.S. housing market will not recover until the individual home mortgages of American families across the country are unraveled out of the complex mortgage-backed securities that were sold by Wall Street to institutional investors worldwide. U.S. Treasury Secretary Paulson wants to purchase these mortgage-backed bonds from Wall Street financial institutions, but it’s unclear how that will help the U.S. housing market recover.
QUESTION: What do you propose to do to protect the value of homes in this country?
4. Foreign financial institutions and foreign investors helped finance U.S. home mortgages during the recent housing boom.
QUESTION: How can you ensure that they return to invest in the U.S. housing market, which despite the current downturn boasts solid long-term value?
5. Our nation’s trade deficit with the rest of the world is a source profound instability on Main Street. The U.S. housing crisis only exacerbates the pain facing Americans across the country.
QUESTION: How would you ensure that our trade with other nations results in growing and broad-based prosperity at home and abroad?
6. Since the world rallied to our support after September 11, 2001 the Bush Administration has squandered that good will and undermined our stature in the world with its unilateral foreign policy and choice to invade Iraq. Now the failure to adequately oversee our markets has led to nations and foreign investors sustaining huge losses in their U.S. investments and sent world markets into chaos—threatening the value of the dollar and our economic credibility worldwide, and weakening our ability to attract foreign investment.
QUESTION: How would you address the damage done to U.S. stature and credibility through the conduct of our foreign and economic policy?
Clear answers to these questions as they relate to international economic policy, global financial stability and, most importantly, average American workers and homeowners, would go a long way toward demonstrating whether the two candidates truly understand the sorry conservative legacy that led to the need for a $700 billion financial rescue package.