SEATTLE POST-INTELLIGENCER EDITORIAL BOARD

We wish Federal Reserve Chairman Ben Bernanke could have told Congress what he really thinks about the jeopardy facing the U.S. economy.

He danced, stepping to the music of an economist. "The intensification of financial stress in recent weeks, which will make lenders still more cautious about extending credit to households and business, could prove a significant drag on growth," he said. "The downside risks to the outlook thus remain a significant concern."

Not so bad, right? Clearly not enough cause for Congress to bail out the fat cats on Wall Street with a price tag that's really "unknowable" but starting with a tab of two grand per person.

Unfortunately, that's not the message America needs to hear. The Fed chief, the Treasury secretary, President Bush and both presidential candidates are all trying to say -- without saying it -- that unless the federal government uses every resource at its disposal, the very economic foundation of this nation could crumble. In an instant there would be no credit for car loans, condos or companies. We, not Wall Street, would be left in the rubble. Without action, we could lose our jobs, our homes and more at a greater cost than a $700 billion intervention.

This is that big a deal.

The final plan will not follow the word-for-word suggestions of Treasury Secretary Henry Paulson -- nor should it. We've said before that transparency, taxpayer protection and accountability are essential to any successful legislation. Even the Obama and McCain campaigns are working on a joint statement about what the rescue must do.

All that's good. But Congress should use this opportunity to engage Americans in the larger discussion about the country's financial state.

Yes, Congress should act, "but not many people like writing a $700 billion check, especially when you're already in a $53 trillion-plus hole and digging at record rates," said former Comptroller General David Walker. He's now a private citizen leading the Peter G. Peterson Foundation to promote fiscal reform before the government itself faces an even greater credit crisis.

"Who's going to bail out the United States? The answer is nobody," Walker said. There should be a fiscal future commission -- one that exams the long-term finances of the nation, followed by the tough medicine that will be required.

If we don't act soon, even careful economists will use words like "systemic collapse."

Source:-http://seattlepi.nwsource.com/opinion/380406_bernanked.html