Bush: Won't back bill that bails out lenders

May 19, 2008 9:04:06 AM PDT
President Bush, acknowledging the economic "tough times" for many Americans, said Monday that he remains opposed to any homeowner rescue legislation that would be a bailout for lenders. The president's comments came as Senate leaders are working on a bipartisan bill to help strapped borrowers get government-backed mortgages, paid for by tapping a fund designed to help poor families. Bush did not comment on that proposed legislation directly. He has threatened to veto a House version of the bill.

"Laws shouldn't bail out lenders," Bush said after getting an economic update from Treasury Secretary Henry Paulson. "Laws shouldn't help speculators. The government ought to be helping creditworthy people stay in their homes."

The president pushed Congress to pass legislation to more tightly regulate Fannie Mae and Freddie Mac, the government-sponsored companies that finance home loans. He said the move would help "stabilize the markets."

The Bush administration on Monday also reiterated its stance that it remains to soon too consider a second economic stimulus boost for the nation. The first package produced tax rebates checks for millions of Americans. Bush said Paulson assured him that people are getting the money as promised.

"It should help our economy, and more importantly, help people pay their bills ... and take care of their families and shop," the president said.

Many Democrats in Congress are pushing for another government-backed economic boost to help people pay deal with rising gas and food prices.