Secretary Paulson refuses to apologize … but he should!

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Secretary Paulson refuses to apologize … but he should!

By Lauren | November 13, 2008

Treasury Secretary Henry Paulson hit a new low when he announced yesterday that he won’t use the $700 billion Congress allocated for the Wall Street bailout to buy mortgage-backed securities after all. Instead, Paulson appears to have made a unilateral decision to buy stock in banks and credit card companies, bail out other industries, and who knows what else. Paulson’s new approach deviates significantly from the plan he announced to Congress when the funds were put aside in September, but he seems to think that’s well within his self-proclaimed “broad authority.”

While announcing this stunning turn in a brand-new direction, Paulson said, “I will never apologize for changing the strategy when the facts change” (emphasis mine).

This latest display of iron-clad arrogance on Secretary Paulson’s part is positively breathtaking. If the facts had changed he might have a point, but that’s not what happened here. When Wall Street first started to crumble, Paulson ran to the Hill and announced that mortgage-backed securities had created the crisis and said he needed $700 billion immediately to buy up bad debt and sidetrack the oncoming financial trainwreck. Congress acted (probably too quickly) to give Paulson the funds and authority he claimed to need. Since then, almost two months have gone by, the economy has tumbled into recession, stocks have plummeted, consumer confidence is at a new low while unemployment rates climb, and Paulson has the gall to say that he won’t apologize.

It’s not that the facts have changed - it’s more likely that Paulson didn’t know what the facts were when he made his pitch to Congress. Back in September when Paulson sold Congress on the $700 billion bailout it was pretty obvious that the federal government was in no position to buy and refinance billions of dollars of individual loans. Apparently, Paulson shot off his mouth without checking his facts first, and now he has $700 billion of taxpayer money at his disposal and, seemingly, no one to call him to account for how he uses it.

Secretary Paulson doesn’t have to apologize for replacing what was undoubtedly a pretty poor strategy with a new one (and let’s hope this one is better). However, to the extent that he shot from the hip and misled Congress and the American public, intentionally or not, an apology is definitely in order. You’re as human as the rest of us, Mr. Secretary. It truly wouldn’t kill you to admit you were wrong and apologize.

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