Paul Tonko Statement on Financial Crisis

Statement

Paul Tonko Statement On Financial Crisis

"In the last 24 hours we have seen several historic and troubling developments from the financial industry. Lehman Brothers, a firm with a 150-year history, collapsed and filed for bankruptcy on Sunday. Merrill Lynch, which was once one of the largest Wall Street firms, has been sold for only half of what it was worth just a few months ago. The American International Group has requested a $40 billion line of credit from the Federal Reserve to prevent that firm from imminent collapse. This comes only a week after the Federal Government took over Fannie Mae and Freddie Mac, in the largest government takeover in history.

"These developments will have far reaching repercussions that will be felt around the world and especially here in the Capital Region. These firms are a significant source of tax revenue for New York State, much of which goes to pay for education and healthcare. We must, as a matter of prudence, look at these failures in a context that provides insight on how to plan for the future.

"This crisis highlights the importance of forward thinking, responsible regulation that both protects investors and prevents the bankers from burning down their own house. Many are responsible for the current financial meltdown, from the mortgage companies that issued large loans with no proof of income to the financial firms that bundled them into securities to the rating agencies that gave misleadingly high ratings to mortgage backed securities. This is yet another example of how the politics of de-regulation has failed to protect both consumers and business."

Paul Tonko is the former President and CEO of NYSERDA and served in the New York State Assembly from 1983 to 2007. He announced his bid for the 21st Congressional District on May 20, 2008 among friends, elected officials and union members.

On September 9 Paul won the Democratic primary, and on Election Day, November 4, Paul will appear on both the Democratic and Working Families Party lines.

Source