Corporate Socialism

I agree with some of the Republicans! Write that down, I am certain you will not hear it often.

The bottom line for this $700 billion bailout is, IF it happens, it needs to have some measure of protection for taxpayers. Congress reiterated this over and over this morning. I was proud of them for speaking up. And found myself nodding in agreement when many of the Republicans spoke.

I know we are all frightened about the financial issues we are facing but making fear-based decisions is simply irresponsible. We need to ensure we make a sensible decision in a timely manner. So, if you are jumping out of your seat, itching for Congress to hurryup and approve this $700billion… take a breath. Think. There is no proof or guarantee that this measure is going to work. It is led by two of the idiots who got us into this financial mess. WHY SHOULDN’T WE AT THE VERY LEAST ASK FOR SOME FAILSTOP MEASURES?

We should NOT bail out these irresponsible corporations. Bottom line. We should NOT give them the $700 billion. Breathe deeply, relax. Think. Please!

Why not attack the problem from the other side? Why not give out $700 billion to the US people losing their homes? Pay their bills to the banking industries. Wouldn’t that make more sense? TO help the people with their own money rather than these corporations.

If this is such a good idea, why does it not have any provisions? At the very least, before we bail out these corporations with no guarantee that it will even help, we should get the following provisions:

1) Remove the sole discretionary clause, giving all authority to Paulson:

“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.”

Paulson is one of the people who is arguably responsibly for allowing this situation to get so out of control. Why are we continuing to allow him to even meddle in our Country’s purse? Slap his hand and say, “NO!” Let someone responsible lead this disgusting bail out. We should, at the very least, be watching our federal bank book. We are the ones making the deposits.

One man should not be in control of that much money. That would be giving the Secretary of the Treasury more power than even the President, at least financially. This is NOT a good idea.

2) Remove the clause that prevents judicial review.

If there is no scam in this, if there is no tomfoolery, why include a provision refusing judicial review? If we are mopping up a mess made by the greed and irresponsibility of financial institutions with a mop made of our hard-earned money, WE HAD BETTER HOLD THE JANITORS ACCOUNTABLE! PERIOD. In every single manner.

3) We need to include a measure to limit how much executives are paid:

They ran their corporations into the ground. Why should they get paid for this? How much do we pay people in public welfare? Why not give the CEO’s, who were irresponsible with the corporations, the same monthly amount we give to those on public welfare? I mean the logic behind the amounts are based on the minimum amount of money needed to survive in our country. Why should these CEO’s be paid more than that? If we are trying to “save” the economy, why don’t we spend the money wisely? Instead of overpaying CEO’s who got themselves (and us) into this mess in the first place with their irresponsible, greedy business practices and channel our money into tangible investments (alternative energy, health care, etc.). We definitely need a provision not allowing ridiculous compensation packages to these CEO’s.

4) Ensure what these people will be doing with our money is a matter of public record, available for all of us to monitor completely. COMPLETE TRANSPARENCY.

They should not be allowed to continue doing business as usual. Look where it got them and us.

5) We need to add provisions to help people in danger of losing their homes.

These failing financial institutions and the mortgage crisis are inextricably linked. We must address the initial problems, not just throw money at it. If you cut off your arm, you certainly would not just throw bandages at it. You would stop the blood loss, sew it up, then let it heal.

This bailout is nothing more than financial welfare, with the standards of living skewed for unsuccessful CEO’s.

The current Administration did such a poor job economically with their deregulation policies, their corporate tax breaks and their direct assistance to these greedy corporations, while ignoring the needs of the consumers and citizens and all of these irresponsible, corporate interest policies ultimately lead us into this crisis. So, if we are going to bail the financial institutions out, the least we could is protect the everyday people as well.

6) We need to add provisions about regulating the financial institutions.

7) Add in a provision for taxpayers to gain financially, if and when the corporations start making money.

If they want us to finance the corporations, they should compensate us. Stocks, shares etc., period.

8) Add in a provision to ensure there are no “sweetheart deals”.

Ensure that no one who was paid to make this decision is in charge of the money. No leaving the US government and going to work for Wall Street. We want there to be no ties. Corporate lobbyists have lined the pocket of too many of our politicians. They have owned the Administration for at least 8 years and look where it has gotten us.

I vote no. And if the “yes” votes win, then they had better stood up for the American people by adding in, at the very least, the previous 8 provisions.

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3 Responses to “Corporate Socialism”

  1. Terence Says:

    I was looking around for some opinions from some people who at least claim to be experts in U.S. History and Economics and found this article at The America Prospect.

    Paulson’s Folly

    Here is an excerpt:

    The deal proposed by Paulson is nothing short of outrageous. It includes no oversight of his own closed-door operations. It merely gives congressional blessing and funding to what he has already been doing, ad hoc. He plans to retain Wall Street firms as advisers to decide just how to cut deals to value and mop up Wall Street’s dubious paper. There are to be no limits on executive compensation for the firms that get relief, and no equity share for the government in exchange for this massive infusion of capital. Both Obama and McCain have opposed the provision denying any judicial review of decisions made by Paulson — a provision that evokes the Bush administration’s suspension of normal constitutional safeguards in its conduct of foreign policy and national security.

    Though the administration’s line is that these securities are not trading because of a crisis of confidence, so many are ultimately backed by loans that will not be paid back that they will eventually be sold for a fraction of their face value. Firms that have marked these securities down or have otherwise gotten them off their books have valued them at around 30 cents on the dollar or less. If Paulson had proposed such a deal in his old job as CEO of Goldman Sachs — putting $700 billion of the firm’s capital at risk in exchange for junk bonds of unknown value — he would have been fired in short order. But this is merely taxpayer money.

    The differences between this proposed bailout and the three closest historical equivalents are immense. When the Reconstruction Finance Corporation of the 1930s pumped a total of $35 billion into U.S. corporations and financial institutions, there was close government supervision and quid pro quos at every step of the way. Much of the time, the RFC became a preferred shareholder and often appointed board members. The Home Owners Loan Corporation, which eventually refinanced one in five mortgage loans, did not operate to bail out banks but to save homeowners. And the Resolution Trust Corporation of the 1980s, created to mop up the damage of the first speculative mortgage meltdown, the savings and loan collapse, did not pump in money to rescue bad investments; it sorted out good assets from bad after the fact, and made sure to purge bad executives as well as bad loans. And all three of these historic cases of public recapitalization were done without suspending judicial review.

    I posted this to show that you are far from alone in your thoughts, and even History is on your side.

    With all this happening I so want to get a history of the U.S. Economy book, if it is out there somewhere.

  2. Chris Hutcherson Says:

    How long will it be before more money is required, Is this just a short term fix ?

  3. Meg Says:

    Hello Chris,

    Thanks for reading my blog. =)

    Part of the money, $250 billion, is available immediately in the plan signed by the Senate last night. (http://money.cnn.com/2008/10/01/news/economy/senate_rescuebill2/?postversion=2008100122)

    This may not be a fix at all. The markets run on paper backed by money of investors. The “points” have been plummeting, scaring everyone. However, how much has this actually cost the investors? Their money has been dwindling for a year or more. And before that…it was artificially high. As far as points if we look back in time, we will see how it can realistically afford to fall many more before we are in real danger.

    Investing is a gamble. EVEN WITHOUT this bailout, if people would calm down, and focus on what is really important (i.e. regulating these corporations so they don’t go haywire like they have, electing real leadership through active research not mindlessly watching news and taking care of the real fundamentals), then the market and the economy would recover.

    Time will tell us if this helps. If it does, I imagine it will be the placebo affect more than anything else.

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