US treasury head defends changes to bailout plan
Updated
![US treasury secretary Henry Paulson was responsible for scrapping plans to buy toxic debts from embattled financial firms. [Reuters]](http://www.radioaustralia.net.au/img/news/base/us_paulson_rtr_030408R.jpg?<BR> "US treasury secretary Henry Paulson was responsible for scrapping plans to buy toxic debts from embattled financial firms. [Reuters]")
US treasury secretary Henry Paulson was responsible for scrapping plans to buy toxic debts from embattled financial firms. [Reuters]
The US Treasury Secretary Henry Paulson has been grilled by Congress about his handling of a $US700 billion financial rescue package.
The Bush administration's program was originally intended to buy bad loans from banks to help ease the credit crisis.
But Mr Paulson has scrapped that plan and is now using the money to buy equity in financial institutions.
"We have adjusted our strategy to most effectively address the urgent crisis and to preserve the flexibility of the president-elect and the new secretary of the treasury to address future challenges in the economy and capital markets."
Meanwhile, he told Congress that money should not be siphoned off from the bailout package to provide emergency loans to America's car makers.
