The Boss of the Bailout
As recently as June, the man anointed by the Treasury Department to steward Wall Street's bailout package was playing down the subprime-mortgage crisis in presentations to private industry groups. In a PowerPoint presentation to Nevada bankers, Neel Kashkari, a former Goldman Sachs banker who is now interim assistant Treasury secretary for financial stability, suggested that only 9 percent of U.S. mortgage holders were behind in their payments compared with "50 percent seriously delinquent in the 1930s." Other slides touted the success of Hope Now, a program to help struggling homeowners renegotiate mortgage terms. But two industry officials who attended the presentations, and who asked for anonymity when discussing private meetings, said Kashkari's overall theme was that massive federal intervention was unnecessary. The message, according to one of the bankers: "There is no problem here." Steven Adamske, a spokesman for Rep. Barney Frank, the Democratic chair of the House Financial Services Committee, said the panel got similar briefings and concluded that the numbers were "dubious."
At the time, chief Treasury spokeswoman Michele Davis acknowledged in e-mails to NEWSWEEK, "Neel was reflecting the Department's view that drastic legislation wasn't needed to deal with the housing correction … but that housing posed the biggest downside risk to the economy." Even though the Bush administration wasn't expecting a meltdown, Davis added, Treasury Secretary Henry Paulson had earlier "directed Neel and others … to do contingency planning … to examine the various policy options out there so if we needed to take stronger action, we'd be prepared to do so." That contingency planning, however, yielded Treasury's initial three-page bailout proposal—which Congress swiftly discarded. A Treasury official, who also asked for anonymity, insisted that the proposal was purposefully thin "so that Congress could add to the proposal to make it their own."
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Mark Hosenball joined Newsweek as an investigative correspondent in November 1993, covering a range of issues for the National Affairs department. Most recently, he has written and reported numerous stories on terrorism and the Sept. 11 attacks on America. He has also covered campaign finance, the Monica Lewinsky controversy, the death of Princess Diana, Whitewater, the crashes of EgyptAir flight 990 and TWA flight 800, as well as related air safety issues.
Hosenball came to Newsweek from "Dateline NBC," where he worked as an investigative producer. He also worked extensively as a print journalist, writing for a number of British and American publications, including the London Sunday Times, the London Evening Standard, Time Out, The Washington Post, The Wall Street Journal, and The New Republic. In addition, he has done commentaries for American Public Radio.
Hosenball has been honored with a number of prestigious awards. Most recently, along with a team of Newsweek correspondents, he was awarded the Overseas Press Club's most prestigious honor, the 2002 Ed Cunningham Memorial Award for best magazine reporting from abroad for Newsweek's coverage of the war on terror. His reporting and that of his colleagues earned Newsweek the prestigious National Magazine Award for General Excellence in 2002 for its coverage of September 11 and its aftermath. And a story he co-authored was highlighted in a citation Newsweek received by the White House Correspondents' Association when it awarded the magazine the 2002 Edgar A. Poe Award for "excellence on a story of national or regional importance. "Newsweek's September 11 coverage started long before the attacks. An article in the magazine's February 19, 2001 issue warned with chilling accuracy: 'The threat posed by (Osama) bin Laden is growing -- and coming ever closer to home."
Hosenball was a contributor to the CANAL + TV documentary, "L'Argent de la Drogue" (Drug Money), which was awarded the "Sept D'Or," the French equivalent of an Emmy. He also contributed to NBC News' coverage of the BCCI scandal, which earned a 1991 Peabody Award.
He attended the University of Pennsylvania and Trinity College in Dublin. He lives in the Washington, D.C. area with his wife and son.
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