By Mark Wineka
mwineka@salisburypost.com
Ty Cobb, the Republican candidate for the 12th District U.S. House seat, said Wednesday “bailout” is the wrong word to describe efforts by federal lawmakers to address the country’s financial turmoil.
Cobb prefers to think of the proposed $700 billion bailout of the ailing financial industry as providing an insurance policy for troubled companies and assets.
“Warren Buffett has said in the long run the government could make money on this,” Cobb said in an interview with the Post. “It’s buying back instruments. It’s not like we’re giving them free money.”
Cobb was looking forward to President Bush’s address to the country later Wednesday night, but he said he thought the government would get its “bailout” money back “one way or the other.”
A similar bailout occurred for the savings and loan industry back in the 1990s, he noted.
Cobb was encouraged by Buffett’s $5 billion investment in Goldman Sachs Tuesday and predicted the financier will end up making a profit on that purchase.
Cobb, who lives in Rockwell, is seeking the seat held by U.S. Rep. Mel Watt, D-N.C., a member of the House Financial Services Committee.
On Watt’s Web site, Cobb said, it notes that the House Financial Services Committee is responsible for the entire monetary policy of the United States. Cobb said he would like to know where that committee and Watt in particular were all this time, while these financial problems were growing.
“Nothing says he was screaming bloody murder,” Cobb said. “When I go to Congress, I’m going to speak up.”
As Congress tries to attach stipulations, accountability and oversight to a bailout plan, it should address golden parachutes paid to company chief executive officers and other officials who often receive million of dollars in buyouts, even as they leave a company that is failing, Cobb said.
It’s not fair to taxpayers, he said. In a capitalist economy, company executives should be compensated for success, not failure, Cobb said.
“I don’t know if anybody would disagree with that,” Cobb said. He described himself as “flabbergasted” that Fannie Mae’s chief executive could receive a $7 million severance package.