Bush’s Handling of Financial Crisis ‘Irresponsible,’ Gingrich Says

(CNSNews.com) – Former House Speaker Newt Gingrich blasted President George Bush and Treasury Secretary Henry Paulson Tuesday over the proposed financial bailout, saying the president “is being absolutely irresponsible” in his handling of the problem.

“There are steps that the administration could take today that would dramatically improve where we are immediately, without legislation” Gingrich said.

“If the president believes anything he is saying in his speeches about how big this crisis is, he should pick up the phone this morning and call SEC (Securities and Exchange Commission) Chairman Chris Cox and tell him to suspend the ‘mark-to-market’ accounting rules, which are the fundamental problem today and can be suspended.”

The mark-to-market system of accounting requires all assets, mortgages, and holdings to be valued at their current market value, regardless of whether that reflects their true worth.

It is an accounting practice that “literally hundreds of the most revered economists” blame for 70 percent of the current problem in the financial markets, Gingrich said.

“If you calculate 70 percent of $700 billion, that is $490 billion” he said.

Gingrich suggested suspending the mark-to-market system for a trial period of two to three weeks, along with suspending the capital gains tax and moving to a three-year rolling average – something that “could be implemented today without congressional involvement,” he said.