The Fed, Biotech Crops and Mortgage Bailouts
Treasury Secretary Henry Paulson officially announces a plan to reform oversight of financial markets.
Research into genetically modified crops gets a boost in India.
President Bush prepares to announce a bailout plan for delinquent homeowners facing foreclosure.
1. ECONOMICS
Treasury Secretary Henry Paulson officially announces a plan to reform oversight of financial markets.
CEI Expert Available to Comment: Center for Entrepreneurship Director John Berlau on where the plan goes too far:
“To propose, as the blueprint does, that the Federal Reserve can examine any business that poses a threat to the financial system, would result in an unacceptably broad jurisdiction. Many small entrepreneurs may suddenly find themselves at the Fed’s mercy. Federal statutes and rules have already stretched the definition of ‘financial institution’ to include such diverse businesses as jewelry stores, car dealers, and travel agencies.”
2. SCIENCE
Research into genetically modified crops gets a boost in India.
CEI Expert Available to Comment: Journalism Fellow Lene Johansen on the importance of this new venture:
“Business incubators have long been a place where small companies can get help that makes them grow to the next level. A non-profit in Hyderabad is now applying that method to the most precarious phase of growth for a plant biotechnology start up: the field trials. The International Crops Research Institute for the Semi Arid Tropics is starting up a research facility that will enable smaller firms to outsource field trials. It is a novel approach to business incubating, and it will be interesting to see the results of this project. It might be a smart business model that we can apply to speed up the second green revolution.”
3. FINANCE
President Bush prepares to announce a bailout plan for delinquent homeowners facing foreclosure.
CEI Expert Available to Comment: Special Projects Counsel Hans Bader on the plan’s perverse incentives:
“…mortgage bailout measures are turning Aesop’s fable about the ant and the grasshopper on its head, rewarding irresponsibility and punishing thrift and prudence. Mortgage bailout proposals are proliferating, even though bailing out irresponsible borrowers and banks is a stupid idea, and is unpopular with the silent majority of Americans, as public opinion polls make clear.”
Blog feature: For more news and analysis, updated throughout the day, visit CEI’s blog, Open Market.
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