What Do We Look for in the Bailout Package? It's Simple

Lots of smart people with extensive financial and economic expertise will weigh in on the bailout legislation now winding it's way through Congress.

I am going to look for four simple things:

1. Taxpayers need equity in the companies we are saving.

If the government is guaranteeing rather than buying the "bad" paper, once those investments pay off -- and many of them eventually will -- we will have gotten nothing for our money. We will absorb the losses but get nothing for the gains.

2. Executive pay must be limited.

Executives of the firms we save must not be allowed to be the ones benefiting. If the firms stock price and profit's increase during the time we are guaranteeing against their losses, there should be a pool where that money goes to ALL employees after the taxpayers are paid back equity on our investment.

3. Congress must have continued Oversight

The authority should sunset after 6 months. There should be a special committee of Members of Congress on an Oversight Board and they should be forbidden from taking political contributions from the financial sector.

4. Stimulus $ that focuses on more than just mortgages -- we need jobs

If sufficient authority already rests within the Federal Housing Authority, the Bush administration must be required to act on it to help regular folks from losing their houses due to bad loan practices and if it is not adequate, it must be increased.

But the other key point of our economic emergency is that too many people are losing their jobs based on financial decisions beyond their control. We have historically high job losses over the past few months. What could be more of an emergency than to address this now rather than wait another six months for Congress and a new president?

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Comments

[WTH901]

Listened to your anwser on AC360 last night in regards bailout.

COOPER: It is interesting, Hilary. When you see their styles, they are very different. And John McCain yesterday was criticizing Obama -- and others have criticized Obama -- for almost being too hands-off, for not really showing leadership, for not necessarily running his party, for not making calls to -- to folks in the House to try to convince Democrats who weren't going to vote for this thing to vote for it.

HILARY ROSEN, DEMOCRATIC STRATEGIST: Well, let's remember, we didn't need more Democrats to vote for it if the Republicans had done what they said.

Can't see how you can blame the GOP. Dems out number the GOP. 40% of the Dems were against. They could have passed the bill on party line vote . How's come Pelosi didn't convince all the Dems to vote for it? .

[toneman335]

We finally have the crooked and greedy bastards where we want them. While having the power of the upper hand we need to deliver the final death blow to this corrupt financial system. The irony is that the system imploded unto itself from its own greedy and corrupt practices.
We cannot approved the present proposed $700 Billion package that at best will have a questionable result. At worst we will reward and revitalize a system that needs to die and be replaced with strong and effective regulations.
It is shameful how this country has turned into an elitist class culture. A place where the general citizen has little or no value and a very small percentage of the population has a high consentration of the wealth and real power.

[WilliePilgrim]

Why don't the bankers tell their investors that if they want to keep making money they themselves have to pay for the bailout. Certainly they've got enough ,money to do this themselves...and after that point I don't think any talk of executive limits on pay will have any relevance..or any other government regulation, for that matter.

[bobdob]

Personally, I'm beginning to believe everyone has lost their mind. If anyone needs to be bailed out, it's not the lenders--it's the borrowers.

Let's not lose our heads here. The Bush Administration has a history of lying in order to get what they want. Henry Paulson has a history of being completely wrong about what's going on in the economy, and Ben Bernanke's ill-advised efforts to stave off a recession by lowering interest rates is a contributing factor in getting us into this mess. These people are not shepherds. They're Judas goats. We follow them at our own peril.

[DanteLabon]

I just don't get it. Last time I checked we lived in a country of laws, yet anymore it seems that if you are well known enough, or have enough money laws don't apply to you. I am hearing the same stuff with this bailout talk as I did with the Iraq war..and warrantless wiretappin­g...outtin­g a CIA agent...ignoring subpoenas at will...tor­ture...ren­dition....­ect. Crimes have been commited. If I go out and rob a gas station I can't just say "Ok, mistakes were made...let's not look back, let's see how we can move forward", I would go to jail. Who are Todd Palin, Karl Rove, Harriet Myers? Can we all just ignore subpoenas now? A lot of people have been hurt in this economic crisis, yet I hear nothing about holding ANYONE accountable. All of these Wall Street fat cats get to keep all of the money they have made, and the taxpayers have to bail out the companies they ran into the ground. Nobody being held accountable will guarantee that this stuff keeps on happening. People do not stop doing things they shouldn't until they are punished for them.

[boomer1949]

Dear Mr./Ms. CEO,
I hear your company is ailing. Gee, that's too bad. But hey, I'm a kind hearted soul and would really like to help you, so here is my plan:

1. I'm willing to take on this burden (even though I can barely put food on the table) because I care about my fellow Americans -- all of my fellow Americans.

2. You Mr./Ms. CEO will need to sacrifice as well (you know eye for an eye, or whatever that saying is) and the word of the day is REDUCTION.

3. I'm sorry to inform you Mr./Ms. CEO, but the only way I can help is for you to take REDUCTION in pay. Let's see, minimum wage sounds about right.

4. Please don't worry Mr./Ms. CEO. Minimum wage is more than enough to live on. Many of us have been doing it for years.

Sincerely,
Mainstream American

[rbspickles]

Let's take this idea even further. Let's confiscate their homes, cars, bank accounts, stocks, mutual funds and anything else that has value. We can then sell it all, put the money in this fund to bail out their ponzi schemes and leave them with $5,000 and a minimum wage job. They caused it, THEY can live with their disaster too. Just like the rest of us.

[Findley]

Call out McCain...the Great Pretender, not Reformer. Show each vote with Bush. Just saying he voted 90% with Bush is too abstract. Make concrete, make real. Show it. Point out each anti-woman vote so women see he says one thing, does another-- should be a talking point and in ads

[530Rose]

If you think its a good idea to get on this now, and you make some valid points, Obama should be the one to take the leadership role in the negotiations. He will be the one in charge of turning this around, and he will be the one to be blames if it fails. And you forgot one basic demand. Section 8 is a complete dealbreaker. No amnesty for any of them.

[Barackisthesame]

He might be incharge. And do you really think Obama should have anything to do with the bail out considering he is one of the top four recipients of lobbyist contributions (along with Hillary and John Kerry) from Fanni and Freddi ?

[530Rose]

Been drinkin' the koolaid again I see. But you should give credit where credit is due, cuz I can tell... Hillary Sent You!

[research]

You GOP didn't even let the dems meet during the 6 years you had absolute power in Washington. You GOP have had Veto power since then.

GOP=Deregu­lation=lie­s=thie3ver­=robber barons.

You are just another GOP liar.

[BushSunkOurShip]

http://journals.democraticunderground.com/McCamy%20Taylor/297
The John McCain Campaign is One Hundred Percent Bulls...

We know who wrote the Enron Loophole. Phil Gramm, McCain’s good buddy and economic adviser who has been hiding in a back room somewhere, ever since he called us a “nation of whiners”. Gramm had to quit politics back in 2002, because everyone knew that he knew about Enron’s dirty dealings, since his wife Wendy worked for the company. But that has not stopped McCain from hiring the would-have­-been-indi­cted-if-an­yone-but-B­ush-was-pr­esident ex-Senator.

[BushSunkOurShip]

http://www.americablog.com/2008/09/mccain-campaign-manager-rick-davis-paid.html

Friday, September 19, 2008
McCain campaign manager Rick Davis paid several hundred thousand dollars to lobby for Fannie Mae and Freddie Mac against federal regulations

[BushSunkOurShip]

If John McCain is for Americans ,, I would hate to see someone who was not..

http://blog.aflcio.org/2008/03/12/mccain-stiffs-us-workers-helps-europeans-win-air-tanker-deal
At a time when American jobs are disappearing and our manufacturing base is being decimated, working people are outraged that Republican presidential nominee John McCain played a key role in the Bush Defense Department’s decision to award one of our largest military contracts to a foreign company.

[yrbmegr]

Correct. The poor pay interest, not taxes. As a result of this bailout, the poor will pay more in interest. Many will not be able to afford it because their real income will continue to fall. More banks will go bust. More bailouts (the bank heads will need more houses to hold all the cash). More inflation. Higher interest rates. Lather, rinse, repeat.

"Interesting game. The only way to win is not to play."

[midwestvoter]

Before a single dime of our money is given to save their corrupt rear ends, I want to see the top executives of every failed company that will receive any tax dollars immediately fired (if they haven't been already) and all severence packages revoked. Those that left as the bottom was falling out should be held responsible for returning every last dime of their golden parachutes or face prosecution and immediate jail time. As far as pensions go, they are not entitled to anything more than the regular employees got in the bail out. Once we add up all the returned millions from these collasal failures and crooks, then we can talk about what the tax payers will need to chip in once our demands are met. Otherwise, we don't have to give them squat and they can fail like any other loser who makes the wrong decisions. I am sick of this country rewarding Ivy League failures. Treat them the way everyone else gets treated. Lock their butts up and throw away the keys.

[SimJack]

Indeed! And ankle bracelets all around whilst they're out shooting a round or two at their white collar prison country clubs. Martini anyone? And use that nice top shelf vodka with the little gold flakes floating around in it this time and please, can someone see that my yacht is moved to Majorca before the hurricane season pipes up. Such a nice break being here away from the wife and her boy toy. Note to self, once released, do this again, just bigger.

[TheIndependenceParty]

Just read a post on CNBC that says Treasury Chief Paulson won't consider the equity position for Amicans in the firms to be bailed out. That seems to me a dealbreaker indeed. I say we drive straight on down the road in this game of chicken to see if the mindless bast.u.r.d in the White House blinks first. Without We the People owning a stake in these firms, ... We the People say "Hell No"!

[ICanHasDemocracy]

and the CEO's alight from their lofty perches with silk of spun gold. Screw everybody else.

[OptionSF]

This post on the front page of Huffpost really worries me, putting the Secy of the Treasury above the law - any court or administrative review? That's absurd, un-American, and should be immediately fought by the Dems and stricken. This should be #1 please add it to your agenda!

[Lazslo]

WE aren't looking for a bailout. The American people don't want the corrupt financial institutions bailed out. Both republicans and democrats are pandering to the people now, and neither of them are saying the correct thing. Everyone has already judged that something needs to be done, and that's wrong. Let the businesses go under.

[pacodog]

Then you would have to say goodbye to payroll, you would find the stores empty just in time for Christmas, no one, not even the Queen of England, would be able to buy your house (well, in less she paid in cash), and the dollar would plummet to depths unknown. You think you're paying a lot for gas now, but if we let the whole financial system crumble, how much do you think it would be worth then?

I understand the anger, but saying "Let 'em fry" is terribly short-sighted an ignorant of the facts.

[wagthedog1001]

By all reports if you let them all fail, we would be right behind. I'm not ready for anarchy in the streets right now. No, we're not looking for a bailout, but who isn't borrowing money from somewhere now?

[Pdubya]

you can not fix creating money out of thin air (inflation) with more inflation. that is, putting more money into the system.

the dollar will devalue so low it will crash long before we could see a return on fannie/freddie, AIG, Goldman Sachs etc etc and the derivatives thereof.

Want to fix this? Our choices are BAD or WORSE. Paulson is proposing WORSE. The inevitable is just being delayed and compounded.

Restore sound money, End the Fed, and hold Congress to issue real money. hey, sounds alot like our constitution.