Washington, D.C. – As the national representative for the U.S. lodging industry, the American Hotel & Lodging Association (AH&LA) has observed with great concern the growing economic turmoil impacting America’s financial markets.  The lifeblood of the entire economy is the free flow of capital, which at its heart relies on available credit and the confidence of lenders.

AH&LA and the U.S. lodging industry applauds President George W. Bush and his administration for taking bold and decisive action to address the fundamental problems that have caused the current financial crisis.  The president’s plan would remove the troubled assets clogging the credit system, restore confidence in the nation’s financial markets, and allow the resumption of the free flow of capital to stimulate the growth of our economy.

Over the last several months, it has become apparent that the economy is fast approaching a crisis point.  As bad loans accumulated in America’s credit stream, they created a block to the free flow of capital due to their inability to be repaid.  As a result, lenders lost confidence in financial markets and stopped providing capital for new investments.  In short, the lifeblood of America’s economy has ceased to flow. 

“This stagnation is a dagger aimed straight at our nation’s economic health,” said Joe McInerney, AH&LA President and CEO.  “America’s lodging industry, along with every American taxpayer and employer, is at severe risk if measures are not immediately taken to address this significant threat to America’s economic vitality.  The Treasury proposal will help rebuild a stable economic foundation for our country.”

Although the issuing of $700 billion worth of Treasury securities to fund the assumption of these troubled assets may initially be deemed expensive, the subsequent sale of those assets after the economy stabilizes will benefit the American taxpayer once those assets are deposited into the General Fund of the U.S. Treasury.  The cost of doing nothing will prove to be much more expensive, and our nation cannot afford the damage to our economy by inaction.

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