The Bush administration has proposed spending $700 billion in public money to buy mountains of mortgage debt, the latest bailout in a series of corporate bailouts and the most massive one to date.

The plan: Allow the Treasury to take over bad loans from beleaguered financial firms so those companies can start lending money again.

The goal: Stabilize the economy.

Nationally, financial experts and lawmakers are split. Proponents say the massive bailout is the best way to get the U.S. out of its financial crisis. Opponents say it’s too expensive and doesn’t offer any independent oversight.

In Maine, we asked local bankers, financial experts and economic gurus to weigh in.

Scott Moody, chief economist for the Maine Heritage Policy Center (A conservative, Portland-based nonprofit think tank)

The proposed bailout: Bad idea

“I personally think they (proposed bailouts) are all very bad ideas. They basically only address the symptoms and not the underlying problems. At best, they may help in the short-term. At worse, they may have unintended consequences that make it all much, much worse in the long run.”

Moody believes excesses of money and cheap credit helped form the crisis and that the supply of money and credit needs to shrink in order for the economy to rebound.

Would like to see: “The normal process to lay itself out.”

Moody wants the government to cease such bailouts and either shrink or eliminate Fannie Mae and Freddie Mac, the quasi-governmental mortgage companies that the government took over two weeks ago.

Christopher St. John, executive director of the Maine Center for Economic Policy (A liberal, Augusta-based independent think tank)

The proposed bailout: Good, depending on the details.

St. John likes the plan to buy bad mortgage debt and sell it at a later date, though he’s unsure whether the Treasury should do that or a new, quasi-governmental organization should be in charge. He is concerned about concentrating so much power within the Treasury. He also worried that the bailout – with taxpayer money – could allow bailed out companies to turn around and give huge bonuses to executives.

“It matters quite a lot how it’s done, and those details are not yet known to us.”

Would like to see: Greater government accountability and accountability by the companies that are bailed out. St. John would also like to see greater assistance to homeowners and re-regulation of financial markets.

“Investors ought to be prepared to take their losses when they make mistakes and if they think the government is going to bail them out every time, it exacerbates the irresponsible behavior that led us to where we are rather than calming that behavior.”

Jim Delamater, president and CEO of Northeast Bank

The proposed bailout: Good, depending on the details.

Delamater likes the bailout plan, though he questions the details, including who, exactly, would get bailed out. “I don’t think anybody knows.”

Would like to see: The government do something that makes sense, including the possible bailout. Regulation and less debt would also help.

“I would support any activity that keeps us from getting in this situation again.”

Mark Walker, vice president and counsel to the Maine Bankers Association

The proposed bailout: Good, depending on the details.

Walker likes the bailout plan, though he and others in the banking industry have questioned some of the details. Although most banks are “safe and sound,” he believes something needs to be done to ensure consumer confidence in the rest of the economy.

“The form of a bailout makes some degree of sense.”

Would like to see: Something with broad support of Congress, the Treasury and others.

“At least it (the bailout proposal) has got them talking about some of the concerns.”

David Flanagan, president of the Maine Public Spending Research Group (Portland-based nonprofit that keeps tabs on tax policy and public spending in Maine)

The proposed bailout: Good

Flanagan believes Plan A was the government’s bailout of individual businesses, including mortgage company Fannie Mae and Freddie Mac and insurance company American International Group Inc. Plan B, he believes, is the massive bailout now proposed.

He cannot think of a better alternative.

“I believe the worst alternative would be to do nothing, which is what the federal government did at the beginning of the Great Depression in 1929 when they made the decision that the federal government had no role in correcting the markets.”

Would like to see: The bailout

Although Flanagan is concerned about the cost of the bailout – $700 billion proposed – and whether the massive spending will mean less federal money available for Medicaid and other programs later, he doesn’t see an alternative.

“I think the consequences of doing nothing are truly staggering and would affect every family in America.”

George Perkins, economics professor at Bates College in Lewiston

The proposed bailout: Good idea

Perkins believes the bailout is prudent and necessary.

“This is not some wild and crazy scheme. It’s the way we addressed the financial crisis of 1989 in establishing the Resolution Trust Corporation. The government didn’t make money on that, but it didn’t lose as much as it had to fork over initially. And it became just another expression of what is probably the most effective tool government can use to stabilize financial markets: using the lender-of-last-resort function.”

Would like to see: The bailout or something close to it

“I’m pleased that they’ve acted, finally.”

John Mahon, dean of the University of Maine’s College of Business

The proposed bailout: Bad idea

Mahon believes the government is rushing into a bailout and he worries about the huge sum of money and unregulated power that will be given to the Treasury if the White House’s proposal becomes a reality. And he is concerned that the $700 billion bailout will balloon, costing taxpayers trillions of dollars they won’t get back.

“There is no need for such haste. We ought to be really clear what it is we’re doing, why we’re doing it and what is it we expect to get out of it before we make a leap of this kind.”

Would like to see: The government prepared to take action but without leaping to it now

“This is almost a time of testing of capitalism. And the question is, are we going to let capitalism work or not? I think that’s a really interesting question. If we’re constantly throwing lifelines, when are we going to be holding people accountable for the decisions that they’ve made? When are we going to say ‘OK, you people kind of screwed this up. We’re not going to bail you out.'”