Q&A with Rep. Barney Frank on the $700 billion bailout proposal

Over the weekend, Treasury Secretary Henry Paulson released his proposal for a $700 billion bailout package. Meanwhile, Democrats were hammering out a counterproposal to salvage the nation’s ailing financial institutions. Now the White House says it is confident that it can reach a deal with Congress this week. For an update on how things are playing out on the Hill, The Takeaway turns to Chairman of the House Financial Services Committee, U.S Representative Barney Frank, who answered your questions.

Guest: U.S. Representative Barney Frank, D-Mass, chairman of the House Financial Services Committee

Representative Barney Frank, D-Mass., has been pretty busy, recently. As the chair of the House Financial Services Committee, any bailout deal for Wall Street will happen under his purview.

It’s been easy to focus on the staggering amount of money that Federal Reserve Board Chairman Ben Bernanke and Treasury Secretary Henry Paulson have requested: $700 billion, or about one third of the total amount brought in by the federal government in 2007. Rep. Frank, however, has been concentrating on the strings that he says have to be attached to any bailout pan. They’re strings such as the creation of an oversight committee that would approve transactions, or restrictions on how much money the executives from these struggling institutions can pay themselves while the rest of the business flounders.

Congressional Democrats and Republicans have been saying they’re sure they’ll have a bailout deal in days, not weeks. Asked by an interviewer whether Congress planned to give the Treasury Secretary untrammeled authority, Frank responded immediately, with a chuckle: “I think we’re going to trammel him.”

The Takeaway took questions from listeners and readers for Barney Frank on how the mortgage industry got into trouble, the pitfalls of regulating too little, and details of the work-in-progress deal.