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Boxer: Banks mustn’t hoard bailout bucks

U.S. Sen. Barbara Boxer, D-Calif., fired a warning shot across the banking industry’s bow — and Treasury Secretary Henry Paulson‘s as well — while taking questions at her San Francisco news conference today.

She called for a crackdown on banks that are sitting on or misusing some of the money they got from the $700 billion public bailout of the finaincial industry; the bailout’s intent was to get credit flowing again, but that won’t happen if banks aren’t lending out the public money they just got.

U.S. taxpayers got preferred stock in these financial institutions, Boxer said, and she believes the investment eventually will come back. But she’s disappointed that the government didn’t use its investment to take voting positions in these institutions, and already there are reports that the money isn’t flowing as it should. Paulson must act, she said.

“There’s going to be this oversight, there’s going to be action if Paulson doesn’t do what he said he would do,” she said today, leaving the door open to further Congressional action. “What we giveth, we can taketh away.”

Josh Richman

Josh Richman covers state and national politics for the Bay Area News Group. A New York City native, he earned a bachelor’s degree in journalism from the University of Missouri and reported for the Express-Times of Easton, Pa. for five years before coming to the Oakland Tribune and ANG Newspapers in 1997. He is a frequent guest on KQED Channel 9’s “This Week in Northern California;” a proud father; an Eagle Scout; a somewhat skilled player of low-stakes poker; a rather good cook; a firm believer in the use of semicolons; and an unabashed political junkie who will never, EVER seek elected office.