The Thurgood Marshall Law Library has recently added two timely Congressional Research Service (CRS) reports to its Special Collections & Digital Projects collection. The Cost of Government Financial Interventions, Past and Present and Proposal to Allow Treasury to Buy Mortgage-Related Assets to Address Financial Instability have been written in response to the financial turmoil occurring in the United States financial markets.
The Cost of Financial Interventions, Past and Present attempts to answer questions about the recent financial interventions by the government in the business of private corporations. Sources of funding and the costs to the taxpayer are discussed. The AIG, Fannie Mae/Freddie Mac, and Bear Stearns cases are used as examples. A table of a Summary of Current and Historical Financial Interventions by the Federal Government is also supplied.
Proposal to Allow Treasury to Buy Mortgage-Related Assets to Address Financial Instability explains Treasury Secretary Paulsen’s [draft of 9/21/2008] plan for legislative authorization to allow direct intervention in the economy. This report analyzes the proposals by answering frequently asked questions.
Although these reports are short – each is six pages long - they contain important information that will help readers understand the severe stress under which the United States financial markets have been operating. They should be standard reading for anyone interested in the subprime mortgage debacle and the ongoing financial crisis.