Shelby discusses economy during Selma breakfast
U.S. Sen. Richard Shelby said America could not borrow its way out of the recession. He said it would take smarter lending practices to turn the economy around.
“I don’t believe any nation, including us, can borrow its way into prosperity,” said Shelby, a Republican from Tuscaloosa. “You’ve got to say no. We’re spending ourselves onto the road of financial destruction.”
Monday, the day before President Barack Obama signed a $787 billion economic stimulus bill, Shelby spoke to a crowd at the Central Alabama Farmer’s Cooperative. He said it is not wise to continue loaning money to banks at the expense of taxpayers.
“I don’t think you can just print money and obligate all this future debt, through the Federal Reserve, for the American people to pay, for the working people to pay,” Shelby said.
Shelby, who sits on the U.S. Senate’s banking and appropriations committees, said he opposed the economic stimulus bill because he believes it would provide little immediate economic relief while worsening the federal debt, which stands at $10.7 trillion.
He said taxpayers should not be responsible for bailing out large banks because they made loans based on social issues, rather than financial. Shelby said loans should be made based on risk if a bank wants to thrive.
“You can’t make a loan because you want to help me,” Shelby said. “You better make a loan because it’s a good loan.”
ALFA Area IX organization director Robert Utsey said leadership in Washington should not panic and take a conservative approach to solving the financial crisis.
“We’ve go to do something but throwing money at problems is not the answer,” he said
While Shelby agreed increased spending is not the answer, he said he would work hard to ensure the state gets its share of the stimulus since the bill passed.
“I don’t want to advocate spending money in Selma or anywhere that’s questionable spending,” he said. “Where things have merit, I’m going to do everything I can to make sure Alabama’s represented.”
Henry Brick Chairman and CEO Ted Henry said he would like to see the state get help as well, but not for ill-conceived projects.
“I know he’s taken a lot of heat, but the stimulus plan is giving away a lot of money,” Henry said of Shelby. “If you have a project that should be funded, it’s different.”
Mayor George Evans said Selma has a laundry list of projects the stimulus could help fund, with infrastructure being top on the list.
“We need big money,” Evans said. “If the infrastructure is no good, you’ve accomplished nothing.”
Shelby said he agreed with about 10 to 15 percent of the economic stimulus bill. Shelby and his fellow Republicans would have liked for the bill to cost about one-fifth of its current amount and poured entirely into shovel-ready infrastructure projects.
“We’ve got some in Alabama,” he said. “I think that would be good, but see, that wouldn’t turn the economy around.”
Shelby said he would gather a team of Nobel-Prize winning economists to begin to figure out exactly how to pull the country out of recession. Until Washington shows some foresight, Shelby said the financial burden would continue to fall on the shoulders of future generations.
“All we’re doing is patching over,” he said. “I think that’s bad precedent.”
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