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Congress: No Blank Check on Bailout! |
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Only a few months ago, the Bush administration repeatedly bashed attempts by Congress to expand health insurance coverage to an additional 4 million children, saying the $35 billion involved was too much to spend.
But now Bush is rushing to ram through a $700 billion corporate bailout—new estimates put the figure at up to $1.8 trillion—for companies whose greed outpaced their brains and plunged our nation into a financial debacle. (Nobel Prize winning economist Joseph Stiglitz concisely calls the disaster “the fruit of hypocrisy.”) The U.S. public isn’t buying it. Only 28 percent support the bailout plan as proposed.
The bailout legislation that U.S. Treasury Secretary Henry Paulson is insisting Congress pass immediately with no changes would give unprecedented power to a single political appointee: Paulson.
It’s not bad enough that Paulson, the former Goldman Sachs chief, wants America’s taxpayers to buy millions of worthless bonds from U.S.-based companies—with no penalties and no oversight for the corporations responsible for this mess. He wants to load us with the same junk debt from foreign corporations—overseas corporations like UBS, which just so happens to employ Phil Gramm, economic guru for Sen. John McCain.
As Attaturk writes on Firedoglake today:
Phil Gramm, of course, is the architect of McCain’s response to the housing mortgage crisis (laughable as it was) this spring; he may still be his Treasury Secretary nominee. He is also vice chairman of UBS’s U.S. division and a lobbyist for UBS.
Under the Bush administration and its McCain clone, it’s not surprising that Gramm would get bailed out. Because while he was in the Senate, Gramm introduced a bill to deregulate the financial industry, creating the monolithic commercial-investment banks that now are going under—and that are asking for us taxpayers to bail them out. Oh, and McCain was among the senators joining Gramm in pushing the bill to deregulate.
Surely, McCain now must regret his actions?
Nope. As Attaturk notes, this exchange took place just yesterday:
Q: In 1999, you were one of the senators who helped pass deregulation of Wall Street. Do you regret that now?
McCAIN: No. I think the deregulation was probably helpful to the growth of our economy.
With 84 lobbyists from Wall Street on his campaign, McCain is so embedded in creating this crisis, he was still saying just last week that the fundamentals of the nation’s economy were strong.
The AFL-CIO is urging Congress to step back, take a deep breath, and not pass the Paulson bailout plan as it is written. Take the time to get it right—and don’t give Bush a blank check. Such a plan must not be overseen by one political appointee, but by independent actors who are looking out for the public interest—not corporate bedfellows.
In a letter to House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Leader Harry Reid (D-Nev.), AFL-CIO President John Sweeney urges that any bailout contain a stringent set of conditions:
- A moratorium on home foreclosures that gives homeowners a chance to restructure their loans.
- An economic recovery and jobs package, including extended unemployment benefits, fiscal relief for state and local governments and a major investment in our nation’s crumbling infrastructure.
- An immediate strengthening of current financial regulations and a commitment to further regulate our financial institutions to protect the public’s money when it is give to private companies.
- Strong public oversight and transparency at the agency created to oversee the expenditure of billions of dollars of taxpayer money to rescue private companies.
As Ian Welsh points out on Firedoglake, the Paulson bailout means the banks bailed out don’t have to change how they do business. In 2007, Wall Street paid itself bonuses equal to the raises of 80 million Americans, but we’re expected to pay $2,324 dollars each (every man, woman and child) to bail them out. And that’s only if the bailout stops at $700 billion.
As written now, the Paulson bailout plan is totally unacceptable, as it contains no independent oversight or reasonable conditions on the use of taxpayers’ money. It is summed up well by both journalist William Greider and writer Richard Behan.
Greider calls it an historic swindle.
Behan, comparing Bush’s rush to pass the bailout with the Bush administration’s rush to the Iraq war, sums it up as “The $700 Billion Bailout: One More Weapon of Mass Deception.”
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For those who have eyes that see and ears that hear:
Shorter Version-
http://video.google.com/videoplay?docid=-9050474362583451279&q=money+as+debt&total=2719&start=0&num=10&so=0&type=search&plindex=0
Complete Version-
http://video.google.com/videosearch?q=money+masters&emb=0#
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-Ben Franklin
“If the American people ever allow private banks to control the issue of their currency, first by inflation, then by deflation, the banks and the corporations which grow up around them will deprive the people of all property until their children wake up homeless on the continent their father conquered.”
-Thomas Jefferson
“The hand that gives is above the hand that takes. Money has no motherland; financiers are without patriotism and without decency: their sole object is gain.”
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-Abraham Lincoln - In a letter written to William Elkin
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-Otto Von Bismark – Chancellor of Germany
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-Otto Von Bismark
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-James Garfield
President James Abram Garfield, our 20th President, had previously been Chairman of the House Committee on Appropriations and was an expert on fiscal matters. (Upon his election, among other things, he appointed an unpopular collector of customs at New York, whereupon the two Senators from New York–Roscoe Conkling and Thomas Platt–resigned their seats.) After only four months in office, President Garfield was shot at a railroad station on July 2, 1881.
“It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning.”
-Henry Ford
“The federal reserve act brought about a super-state controlled by international bankers and international industrialists acting together to enslave the world for their own pleasure.”
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-Sen. Charles Lindbergh (R-Mn)
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-Wright Patman (D-TX)
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-Franklin Delano Roosevelt
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-John F. Kennedy
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- Marina Oswald wife of accused assassin Lee Harvey Oswald, as told to A.J. Weberman
“Today, America would be outraged if U.N. troops entered Los Angeles to restore order. Tomorrow they will be grateful! This is especially true if they were told that there were an outside threat from beyond, whether real or promulgated, that threatened our very existence. It is then that all peoples of the world will plead to deliver them from this evil. The one thing every man fears is the unknown. When presented with this scenario, individual rights will be willingly relinquished for the guarantee of their well-being granted to them by the World Government.”
- Henry Kissinger, Bilderberger Conference in Evians, France, 1991
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- Congressman Larry P. McDonald, 1976, killed in the Korean Airlines 747 that was shot down by the Soviets
Senator John Heinz and former Senator John Tower had served on powerful Senate banking and finance committees and were outspoken critics of the Federal Reserve and the Eastern Establishment. On April 4, 1991, Senator John Heinz was killed in a plane crash near Philadelphia. On the next day, April 5, 1991, former Senator John Tower was also killed in a plane crash.
“Some even believe we (the Rockefeller family) are part of a secret cabal working against the best interests of the United States, characterizing my family and me as ‘internationalists’ and of conspiring with others around the world to build a more integrated global political and economic structure – one world, if you will. If that’s the charge, I stand guilty, and I am proud of it.”
- David Rockefeller, Memoirs, page 405
“We are on the verge of a global transformation. All we need is the right major crisis and the nations will accept the New World Order.”
- David Rockefeller
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- David Rockefeller, Bilderberg Meeting, June 1991 Baden, Germany
“The few who understand the system, will either be so interested from it’s profits or so dependent on it’s favors, that there will be no opposition from that class.”
-Mayer Amschel Bauer Rothschild
“Give me control of a nation’s money and I care not who makes it’s laws.”
-Mayer Amschel Bauer Rothschild
Thanks for the links. Watched about half of the short version and was quite surprised how the system really works. Never gave it much thought.
The “bailout” does not create any new money - it simply changes who will foot the bill - hedge fund speculators and their buddies in the Federal Reserve and Treasury, or working people. I wrote the following letter to Senator Barbara Mikulski on April 8, 2008, after the Bear Stearns ‘micro-bailout.’ The response clearly showed another clueless Senator about to be snookered by money center bank sharks.
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Observing the evolving economic debacle and the tepid and ineffectual response to what is the beginning of a major economic depression, I felt driven to quickly outline some thoughts. Perhaps you might find them useful as you continue to intelligently represent us in the Senate.
Any plan to mitigate the economic downturn should vest most of the resources at the community level, from homeowners to owners of small businesses that provide most of our employment. It should not vest resources into those money center banks that over-leveraged themselves and are now functionally insolvent. The current Fed actions, such as the bail out of Bear and the financing of Countrywide through an FHA loan to prepare it for a buy out suggests that Fed policy is focusing on the survival of the financial elite, rather than ordinary citizens. Rather than throwing resources at what are essentially self-declared clueless speculators, such as Bear, the Fed should be assisting ordinary citizens.
Here are some possible courses of action, wihtin the limits of my knowledge.
1) The Fed should immediately stop providing cheap money to the money center banks. Those who did not speculate will survive, and those who did do not deserve a bail out. This would send a message to these elite that wild leverage is well rewarded since the Fed will always accommodate the ugly aftermath. This is not the job of the Fed.
2) Instead, the Fed should be using its authority to distribute the low interest liquidity to community banks and Savings and Loans. Those community agencies would be chartered to use the money to bid as the buyer of last resort, for foreclosed real estate. In this way, they would not be interefering with the free market clearing process, but would asssure that creditors receive some fraction back of their assets.
3) Those homes, under the program, would be resold to local citizens who qualified for low interest loans. Since the price would be dicounted, they would be more affordable.
4) Responsibility for the loans would remain with the local banks. “Securitization” and selling of this loan paper to third parties would be prohibited.
5) Having noticed a significant resurgence in high-tech, high-skilled manufacturing by small businesses taking advantage of the low dollar by increasing exports - I would also significantly expand a small business loan program, which would allow these businesses to expand into world markets, and enhance local employment.
6) Those loans would be managed on a local level by banks and S&L’s participating in the program
7) Legislation prohibiting the securitization of home loans should be passed immediately.
I suspect there will be much dismay focused on money center banks in the coming months. The energy needs to be used to wrest control of the economy from the small number of financial elites. Those elites dealing in paper and derivatives, and employing few people cannot and should not be supported or encouraged.
The remaining resources need to be focused at the community level - where people live, and smalleer businesses thrive.
I appreciate your taking the time to peruse this somewhat hastily written letter. Hopefully I managed to convey some reasonable information for your consideration in the upcoming hearings regarding this financial debacle.
—-
Tell Congress: Vote NO Bailout
Money for working people, not banks!
Under Bush’s scheme, the big bankers who caused the financial meltdown by manipulating markets and home buyers will cash in even more on the disaster they created. This is a classic stick-up of the “Give us your money or we will sink your economy” variety. And this from the 1% who already own more wealth than the bottom 90%.
Congressional mouthpieces for this proposal from Treasury Secretary Paulsen use trickledown jargon to sell it to the public. They claim the bailout is necessary in order to preserve and save pensions.
But wouldn’t it be more efficient to give this money directly to the people who need it? Congress could create federal programs to build low-income housing, fix roads and infrastructure, retrain workers, extend unemployment befits, lower mortgage rates so folks can stay in their homes, pour money into Social Security and pensions, and subsidize health care.
This is urgent! Call Congress NOW as they are deliberating! Tell them to vote no on the bailout.
Please FLOOD the Congress with phone calls, emails, letters and personal visits to stop this bill in its tracks. This is the financial equivalent of the Patriot Act except the new Czar is Paulson who used to work for Goldman-Sachs and is the problem and not the solution. If this passes say good-bye to Social Security and every other social program because there will be no money. Plus our dollar will be worthless since no foreign economy will want to invest in the USA.
Here is action we all can take!
What follows is a petition authored by Senator Bernie Sanders
Here’s a link to Senator Sanders -
http://sanders.senate.gov/petitions/?petition=Financial_Crisis_1
Financial Crisis
Dear Secretary Paulson:
As a representative of the Bush Administration, you have proposed a financial bailout program of $700 billion – over $2,000 for every man, woman, and child in the country. We are appalled that your proposal puts the cost of this bailout on average Americans; that it contains no provisions reversing failed deregulatory policies; that it allows executives at these failed institutions to continue to make exorbitant salaries and bonuses, and that your proposal contains no help for average Americans who themselves are facing severe economic hardships.
While the Administration has quickly rallied to help Wall Street, it has ignored the needs of the declining middle class. Since President Bush has been in office the wealthiest people in this country have made out like bandits and have not had it so good since the 1920s. The top one-tenth of one percent now earn more income than the bottom 50 percent of Americans and the top one percent own more wealth than the bottom 90 percent. Incredibly, the richest 400 people in our country saw their wealth increase by $670 billion during the Bush presidency.
Having mismanaged the economy for 8 years while continually insisting that, “The fundamentals of our economy are strong,” the Bush Administration, six weeks before an election, wants the middle class of this country to bail out Wall Street to the tune of one trillion dollars. Meanwhile the wealthiest people, those who have benefited most from Bush’s policies and are in the best position to pay, are being asked for no sacrifice at all. This is absurd.
Any plan to clean up the mess on Wall Street must:
Ensure that middle income and working families are not the ones who are paying for this bailout by Imposing a five-year, 10 percent surtax on income over $1 million a year for couples and over $500,000 for single taxpayers. That would raise more than $300 billion in revenue over five years; Ensuring that assets purchased from banks are realistically discounted so companies are not rewarded for their risky behavior and taxpayers can recover the amount they paid for them; and Requiring that taxpayers receive equity stakes in the bailed-out companies so that the taxpayers’ assumption of risk is rewarded when companies’ stock goes up.
Taken together these three provisions will substantially reduce the likelihood that this bailout will end up on the backs of average American taxpayers.
Include a major economic recovery package which puts Americans to work at decent wages. Among many other areas, we can create millions of jobs rebuilding our crumbling infrastructure and moving our country from fossil fuels to energy efficiency and sustainable energy. Further, we must protect our must vulnerable families from the very difficult times they are experiencing.
Repeal the disastrous de-regulatory legislation that facilitated this crisis.
End the danger posed by companies that are “too big too fail,” that is, companies whose failure would cause systemic harm to the U.S. economy. If a company is too big to fail, it is too big to exist. We need to determine which companies fall in this category and then break them up.
In closing, we believe it is appropriate to act quickly to address any systemic danger to our economy. But that does not mean that we need to give a blank check to the financial sector.
Sincerely,
Senator Bernie Sanders
Citizen Co-Signers
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Before the government considers helping these companies they must first liquidate all their assets and write down their loses. Only then should the government give financial assistance and only in a receivership type of arrangement. It’s not the US taxpayers responsibility to prop up share prices or guarantee executive salary and bonuses.
I think the concept of returning money to each person in the country to bail themselves out is a brilliant one. Let’s have an open session (to the viewing public) of how our earnings are spent… open just like the first discussion regarding this bailout when our wonderful candidates trotted themselves back to Washington and decided to team up!
I have sent an e-mail to the President,my Senators my Representatives and Sec.Paulson.Asking that if we must do a bailout of 700 Billion that instead of giving the money to wall street they give every man woman and child in the country 2 million dollars each.The population is somewhere around 300 Million souls.If they would do that I think we could probably bail ourselves out.It should go a long way toward eliminating debt We then would not need to borrow money and neither would most small businesses.Just look at the savings for about 600 Million the problem for working class people is solved.
Rep Marcy Kaptur (D-Ohio) speaks her mind on the bailout. Right on!
I should not make jokes,I believe my mutiplication is just a little bit off,on my bail out plan.
My name is Debora Edholm and as a citizen of what used to be one the largest economic powers in the world, I ask when will the greed of the corporate elite stop. Who will bail out the auto maker and his family when his job goes away? Who will bail out the average person when their job is sent overseas? I say no to this bail out. If the company is too big to fail then it is too big to do good business in our country. Corporations must not cook the books any longer. We are only seeing the beginning of the companies that will go out and how in the world can the average taxpayer bail everyone out when most people are trying to pay for gas and get to work and put food on the table. Insanity once again. Really ready for Obama…………….
try #2 for link. Rep Marcy Kaptur (D-Ohio) speaks her mind on the bailout. Right on!
C-Span Clip
“Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.”
This is language from the lame duck president’s bail out proposal to Congress. I say get a rope and drag his a– back to Texas. Enough with his scare tactics and demanding Congress supply him with what he wants. When he left Texas to go f—up America, he was asked the huge deficit he causes as governor, he said “It’s not my problem, it’s the next guy’s problem”.