Paulson and Bernanke are testifying before the Senate Banking Committee. Watch it here.
The Democrats are pushing Paulson to explain his opposition to Chris Dodd’s plan, which would essentially nationalize the U.S. banking system. The editors weighed in on this today:
Under Dodd’s plan, companies selling assets to the government would also have to give up an equity share, agree to limited executive compensation and submit to whatever other conditions Dodd can think up between now and when the bill reaches the floor. This is the same approach the Fed took with AIG. The Treasury Department has rejected this approach because it would discourage firms from selling bad assets until they were on the brink of failure, thus prolonging the current period of uncertainty and crisis.