Monday, September 22, 2008

Blank Check

Is there a pattern here? Government by historic disaster: 9/11, Wall Street collapse, Mortgage meltdown, Oil Crisis. No plans. Nobody sees anything coming. Then when the front wheels leave the ground, somebody shouts, “We’re going off the cliff.” No time to think or ask questions. The end of the world is at hand. Send the troops to war. Socialize the economy. Before the election. Conclusion 1: George Bush is the worse President ever. Conclusion 2: Republicans are wrong; the United States does need a government. Conclusion 3: Somebody stole the money. Take your pick.

So the Bush administration is asking Congress to write a check to cover Wall Street’s bad debts. Estimates reach $70-Billion, or even a trillion. I can’t even count that high. How many zeros in a trillion? At first blush, the bail-out will cost each and every American family $2,000 to $5,000. Then, who is next on the list of big businesses run aground and asking for help from the taxpayer? Some say auto makers. Another $25-Billion or so for this sad collection of suits who cannot keep their eyes on the road. The cost for refusing to do it? Auto workers without jobs, maybe 250,000 of them. Look, this is not creeping socialism. This is socialism with the pedal to the metal. Who do we think we are, China?

Robert Reich, former Secretary of Labor under President Bill Clinton, suggests, “The public doesn't like a blank check. They think this whole bailout idea is nuts. They see fat cats on Wall Street who have raked in zillions for years, now extorting in effect $2,000 to $5,000 from every American family to make up for their own nonfeasance, malfeasance, greed, and just plain stupidity. Wall Street's request for a blank check comes at the same time most of the public is worried about their jobs and declining wages, and having enough money to pay for gas and food and health insurance, meet their car payments and mortgage payments, and save for their retirement and children’s college education. And so the public is asking: Why should Wall Street get bailed out by me when I'm getting screwed?”

Here is Reich’s five point plan to guide Congress through these uncharted waters:

Any taxpayer bailout must give the government a proportionate equity so that after the economic recovery, taxpayers, the new stockholders, receive profits, dividends, and bonuses.

CEOs, executives, and fat cats who got us into this mess should relinquish their stock options and salaries, and future salaries should be linked to profitability.

Prohibit campaign contributions from Wall Street executives and PACs. Taxpayer dollars used to get our nation out of a crisis cannot be used to prop up lobby operations.

Regulation, regulation, regulation. Wall Street can not expect to take taxpayer dollars without increased transparency and more oversight, the absence of which caused the current mess.

Bankruptcy judges get broader leeway to help homeowners. Why should working families lose our homes so CEOs can keep theirs, even if they do not know how many they’ve got.

Copyright 2008 by William C. Cotter


Ella said...

Thank you. This is a much needed and illuminating message, Bill. Kudos.

Tina said...

I am POA for my 83 year old uncle who is in a nice nursing home with heavy expenses. He is a private pay resident, not on medicaid.
He is an old bachelor, worked hard all his life and made good investments. The American way, right? He did everything he was supposed to do...worked hard, saved and put away dollars for the future.
The Wall Street millionaires with their golden parachutes can come out of this bucket of mud smelling like roses, but what about investors like my uncle who counted on their investments to protect them from being indigent in old age?
He also lost money to Enron. :-(

Anonymous said...

One of the best things I've read on this mess. Thanks.

Angie said...

What happened to Robin Hood? When did things get so turned around in this country that it's stealing from the poor to give to the rich?


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