I don't know about you, but I've been a little off put by the tone surrounding the banking bailout. It sounds sort of like since it is clear that something does have to be done the people that created the mess think they should be able to tell us what they want done to fix it.
Ladies and gentlemen of the financial sector, over the past couple of years you've clearly demonstrated that you do not have any perspective on your industry and selfishly prioritize yourselves far in front of the customer, let alone the public good. On behalf of the rest of the people of the United States I have a message for you: Shut the fuck up.
$700,000,000,000
Just take a moment and look at that number. The first time I typed it I bailed out at seven hundred million. It's just stratospheric. I don't understand a number with that many digits. Right thinking people would have long before switched to exponential notation.
The powers that be say that they need to give this much money to financial companies to keep the credit market from freezing - that without this injection of capital there will be no money to loan. I have a better idea. Just give the people the $700,000,000,000 and nobody will need to borrow money (ok ,that's probably not true, it only comes to like $2200/person if you tally everyone - although that would be more than $10,000 for a family of five).
Interestingly it sounds like really nobody is for this plan as the White House is scripting it. The Republicans think it's socialist and the Democrats think its a corporate bonanza. Hard to be in favor of pretty much anything both parties can muster opposition for.
Like I started though, I think I can be convinced that something does need to be done. I just don't like the air of expectation I am perceiving, like this is some sort of natural disaster the we should all be rallying together to overcome. But this mess isn't Katrina. It's not a fire, or an earthquake or a tsunami - no matter how much hyperbole the newscasters apply to it. Really this is a consumer product disaster, maybe the worst one ever. Worse than the Pinto, worse than Falidomide, worse than Love Canal, worse than the 1980's Tylenol scare, probably even worse than Bhopal or Chernobyl; in terms of man made disasters this one is right up there.
There should not be a rescue without accountability, restitution, and some kind of future assurances.
So if the powers of the financial sector and their lobbyists think the time is right to weigh in making us feel grateful for their help maybe we ought to float some provisions that will make them happy for whatever they can get, and thankful we weren't as aggressive as we could, as maybe we should be. There's talk on the news about how uncomfortable people are with tying top-executive compensation to a bail out. That's really the very least we should be talking about. Perhaps it shouldn't just be top execs, and maybe... maybe it ought to be retroactive to the inception date of the first asset we the people are being asked to buy. I mean, they were screwing up a long time ago, why should they get to keep all that money?
Talk about making them liable for retroactive exorbitant salary and maybe they won't fight so hard about future salary caps.
A list of perfectly justified bailout conditions to maybe help tilt the conversation in our favor:
- Anyone holding a management position in a company involved in the bailout is enjoined from holding any financial services job for the period of the bailout
- Upon resolution of the troubled investments any company selling these investments is to be liquidated with the proceeds going to the Treasury
- A special prosecutor is appointed to research all transactions of all companies utilizing the bailout looking for fraud or criminal negligence, companies involved shall have no privilege or 5th amendment protection from this investigation
- The entire cost of the bailout will be covered by a special tax to be levied only against people making in excess of $1,000,000/yr or 80% of their income from investments for as long as it takes to refund the Treasury
- No employee of any bailed out company or their board shall receive annual compensation greater than the highest paid analogous US Government employee retroactive to the sale date of the first asset assumed by the Treasury
- Although the current Congress and administration can make the promise, not one nickle will be allocated until March 1st, 2009
Making a mess so big you can't clean it up yourself needs to have real repercussions. From what we see on TV so far I don't think the parties involved feel that way. I can't help but think if that point isn't driven home to them they will simply find a different kind of mess to make after you and I put up the cash to clean up this one.
1 comment:
i can't believe how the dems are screwing up this oppurtunity. they've got the majority of both houses and the republicans are all over the place, so no matter what they say gos. they could be tacking huge demands to this bill: "oh, wall street wants $700,000,000,000? that's cool, but we're going to get nationalized healthcare/main street stimulus package/progressive tax structure at the same time". if wall street really needs this money, they're going to make sure the bill passes no matter what the cost. if they'd rather walk away from it because of add-ons like those (much less "punitive" ceo salary caps) then they clearly don't need it that badly.
instead, we've got a majority of dems backing a bill that a lame duck president introduced, but that the majority of his party is rejecting. if this bill is just put up to a vote, even with minor modifications being discussed now, the democrats are screwed either way. if they approve it they've just spent all the money obama (if he's elected) was planning to use on his social reforms and anything else, and this bill will be remembered as typical liberal free-market interference (who will remember that bush started it when it passes with the dems and over the republican) and the subsequent tax hikes will serve to validate the typical conservative criticism that democrats want to raise taxes.
if its defeated, democrats will be blamed anyway, since they hold the cards, and the subsequent wall street fluctuations and any economic problems can instantly be placed at their feet.
it's lose-lose until they remember that they have the power right now and lose their fear of a bush veto (which i don't think would happen under any circumstances anyway.)
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