WASHINGTON (Reuters) – Senate Democrats issued a counterproposal to the Treasury Department’s $700 billion Wall Street bailout plan on Monday that would give the government a stake in firms unloading assets under the plan, and limit the pay of corporate executives involved.
The Democrats also want to set up an oversight board that would include the chairmen of the Federal Reserve, and to limit the Treasury’s otherwise largely unfettered powers, according to a legislative proposal released by the office of U.S. , D-Connecticut, chairman of the Senate Banking Committee.
According to the proposal, Treasury may not purchase, or commit to purchase, any troubled assets unless it “receives contingent shares in the financial institution from which such assets are to be purchased equal in value to the purchase price of the assets to be purchased.”
Also included is a provision to ensure decisions taken by the Treasury secretary under the bailout would be reviewable under some circumstances. The Treasury had asked that decisions not be reviewable by any administrative body or court.
The Senate Democrats’ language also calls for assistance to homeowners and localities to prevent foreclosures.
The draft released by Dodd “does not reflect an agreement with the (Bush) administration on a legislative product for Senate debate. Discussions and negotiations continue,” a statement from Dodd’s office said.
(Reporting by Richard Cowan and Kevin Drawbaugh; editing by Jeffrey Benkoe