(Angus Reid Global Monitor) - Few adults in the United States are convinced about the proposal for the federal government to purchase up to $700 billion U.S. in assets from finance companies, according to a poll by Rasmussen Reports. Only 28 per cent of respondents favour the plan.

George W. Bush—a Republican—earned a second four-year term in the November 2004 presidential election. The next presidential election will take place on Nov. 4.

Since last year, defaults on so-called subprime mortgages—credit given to high-risk borrowers—have caused volatility in domestic and financial markets and raised concerns that the U.S. economy could fall into a recession.

Earlier this year, the U.S. government took control of mortgage lenders Fannie Mae and Freddie Mac. Other financial institutions—including Bear Stearns, Merril Lynch, Lehman Brothers, American International Group (AIG) and IndyMac Bancorp—have been sold, placed under bankruptcy protection, or received emergency loans from the Federal Reserve. On Sept. 15, the stock market plummeted in North America, Europe and Asia.

Yesterday, Bush addressed the nation to explain the situation, saying, "First, the plan is big enough to solve a serious problem. Under our proposal, the federal government would put up to $700 billion taxpayer dollars on the line to purchase troubled assets that are clogging the financial system. In the short term, this will free up banks to resume the flow of credit to American families and businesses. And this will help our economy grow. Second, as markets have lost confidence in mortgage-backed securities, their prices have dropped sharply. Yet the value of many of these assets will likely be higher than their current price, because the vast majority of Americans will ultimately pay off their mortgages."

House speaker Nancy Pelosi commented on Bush’s speech, saying, "I was pleased that the president acknowledged the improvements Congress has made to his original proposal, which was unacceptable. In Congress, we are committed to passing bipartisan legislation that will stabilize the markets, protect taxpayers, establish tough oversight, and curb excessive CEO compensation. And we will pass it soon."

Polling Data

Do you favour or oppose the proposal for the federal government to purchase up to $700 billion in assets from finance companies?

Source: Rasmussen Reports
Methodology: Telephone interviews with 1,000 American likely voters, conducted on Sept. 21, 2008. Margin of error is 3 per cent.

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