Homeowners Need Bailout, Too: FDIC Chief

Regulator clashes with Paulson, Bernanke over relief for lenders
By Jim O'Neill,  Newser Staff
Posted Oct 16, 2008 9:25 AM CDT
Homeowners Need Bailout, Too: FDIC Chief
FDIC chair Sheila Bair testifies on Capitol Hill in Washington, Thursday, Jan. 31, 2008.   (AP Photos/Susan Walsh)

The FDIC chief is blasting the White House and Congress for focusing the $700 billion bailout on financial institutions and not giving homeowners facing foreclosure more help, reports the Wall Street Journal. Sheila Bair, a Bush appointee, says the government’s insistence that homeowners not profit from its help—while appearing unconcerned about institutional profiteering—has been “a frustration.”

A White House spokesman said the legislation "does a lot for homeowners," but the increasingly powerful regulator has been sounding the alarm over foreclosures for months. "Why there's been such a political focus on making sure we're not unduly helping borrowers but then we're providing all this massive assistance at the institutional level, I don't understand it," Bair said. (More financial crisis stories.)

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