SENECA — While many may disagree at the national and local level on the proposed Emergency Economic Stabilization Act, otherwise known as the federal government’s “bailout” of the country’s struggling financial system, most in the business of finance agree that the crisis will hit home.

Fred Shepherd, president of Community First Bank in Seneca, said that while most community and commercial banks are still plenty safe to save money due to Federal Deposit Insurance Corporation (FDIC) backing, there exists a myriad of ways the bailout’s success or failure to pass in the U.S. House of Representatives will affect those in the Upstate.

“Something has to pass because the problem has such a large impact on our entire economy; something must be done to help stabilize it,” Shepherd said. “The average person in Seneca, S.C. who owns a home has seen property values decline in the last year and a half. If they pass this, it will hopefully help stabilize some of the economy, which will then stabilize the real estate market, and the individual homeowner will not see the value decline anymore. If nothing else, it should slow down the foreclosure market and help stabilize the real estate market.”

Real estate is only one aspect that could be affected, according to Shepherd and CEO of Blue Ridge Bank of Walhalla Glenn Buddin Jr. 401K’s and other retirement funds that depend on the success of mutuals and other stock values could be hit by a culture of fear on Wall Street. The worse the credit crisis grows due to the growing number of foreclosures and bad assets, the better the chances of the stock market taking a dive — as it did Monday with a record 777-point drop.

“If the stock market stabilizes, many people’s retirement funds will stabilize as well,” Shepherd said. “This will help stabilize the market a little, which is very necessary. We have to stabilize because we can’t operate in an environment of panic from one day to the next. It’s hard to do business in panic.

“But let me say that I don’t think that whatever Congress passes is going to be the silver bullet,” he warned. “It isn’t going to cure all of our economic problems. But it can help put confidence back into the national market.”

Buddin said there exists a very real risk to middle-class Americans should the credit crisis continue unchecked. While no one likes the idea of bailing out multi-billion dollar corporations, he said, many of the institutions have simply become “too big not to save,” as their influence on the broader economic scope reaches from Wall Street to Main Street.

“It’s an unfortunate situation. These big banks took on a lot of risks for a long time, now they’re paying the price,” Buddin said. “I don’t think anyone is happy with the fact that we have to do this, but I believe we’ll have to do something. The credit market is really at stake here. That’s everyone’s ability to get credit when it is needed.”

With a problem in contracted liquidity, lenders may not be able to provide credit to small and even large businesses for whatever reason they may need such money.

“For us locally, at the business level, if people need to meet payroll, or they want to grow — let’s say Timken wanted to expand and needed credit to do that, the way things are going now, they might not be able to do that because all the large banks took all this risk,” Buddin said. “All their cash is tied up in mortgages they cannot sell to anyone.”

Ultimately, he said, there could be severe problems with borrowing for homeownership and business loans, and economic stagnation and even recession could occur.

Lowell Macher, President of Dominion Mortgage & Financial Services Inc. said that while the bailout’s failure to pass in the House due to the dissent of representatives like Gresham Barrett may harm some people, voting it down was the right thing to do.

“I don’t think it’s the people’s place to bail out corporate America,” Macher said. “We’re in a free market, and all markets correct themselves; we shouldn’t look for the government to solve our economic problems. What we should be doing for sure is putting some of these corporate executives in jail.”

Macher said he was offering one free session of financial advice for those who are suffering in the credit crisis, and thinks the role of church, family and communities rallying together to solve problems, even dire economic ones, is a better option than looking to Washington for help.

“We should be focusing on helping out our next-door neighbor,” Macher said. “We’ve lost sight of that. America is too used to a quick-fix mentality and wants something for nothing sometimes. It just doesn’t happen that way. That may be a little bit harsh, but that is a reality of life.”

Meanwhile, Buddin and Wachovia Securities Chief Finance Officer Ernie Wright believe doing nothing could have serious consequences.

“It’s hard to say what would happen for sure,” Buddin said. “There would be a lack of growth in the economy, and that lack of growth at the very least would see no new job creation and possibly job losses. Most likely a recession would be a minimum.”

Wright agreed.

“I’m afraid not doing anything would be a huge mistake,” Wright said. “Sitting on our hands is not going to help. This is not a Wall Street problem. It’s a Main Street problem.”