[Dialogue] Emailing: t r u t h o u t Paulson Bailout Plan a Historic Swindle.htm
Harry Wainwright
h-wainwright at charter.net
Mon Sep 22 16:32:37 EDT 2008
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Opinion
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Paulson Bailout
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle>
Plan a Historic Swindle
Friday 19 September 2008
<http://www.thenation.com/doc/20081006/greider> >
by: William Greider, The Nation
photo <http://www.truthout.org/files/images/N1_092108A.jpg>
(Illustration: The Conservatard)
Financial-market wise guys, who had been seized with fear, are suddenly
drunk with hope. They are rallying explosively because they think they have
successfully stampeded Washington into accepting the Wall Street Journal
solution to the crisis: dump it all on the taxpayers. That is the meaning of
the massive bailout Treasury Secretary Henry Paulson has shopped around
Congress. It would relieve the major banks and investment firms of their
mountainous rotten assets and make the public swallow their losses - many
hundreds of billions, maybe much more. What's not to like if you are a
financial titan threatened with extinction?
If Wall Street gets away with this, it will represent an historic
swindle of the American public - all sugar for the villains, lasting pain
and damage for the victims. My advice to Washington politicians: Stop, take
a deep breath and examine what you are being told to do by so-called
"responsible opinion." If this deal succeeds, I predict it will become a
transforming event in American politics - exposing the deep deformities in
our democracy and launching a tidal wave of righteous anger and popular
rebellion. As I have been saying for several months, this crisis has the
potential to bring down one or both political parties, take your choice.
Christopher Whalen of Institutional Risk Analytics, a brave conservative
critic, put it plainly: "The joyous reception from Congressional Democrats
to Paulson's latest massive bailout proposal smells an awful lot like yet
another corporatist lovefest between Washington's one-party government and
the Sell Side investment banks."
A kindred critic, Josh Rosner of Graham Fisher in New York, defined the
sponsors of this stampede to action: "Let us be clear, it is not citizen
groups, private investors, equity investors or institutional investors
broadly who are calling for this government purchase fund. It is almost
exclusively being lobbied for by precisely those institutions that believed
they were 'smarter than the rest of us,' institutions who need to get those
assets off their balance sheet at an inflated value lest they be at risk of
large losses or worse."
Let me be clear. The scandal is not that government is acting. The
scandal is that government is not acting forcefully enough - using its
ultimate emergency powers to take full control of the financial system and
impose order on banks, firms and markets. Stop the music, so to speak,
instead of allowing individual financiers and traders to take opportunistic
moves to save themselves at the expense of the system. The step-by-step
rescues that the Federal Reserve and Treasury have executed to date have
failed utterly to reverse the flight of investors and banks worldwide from
lending or buying in doubtful times. There is no obvious reason to assume
this bailout proposal will change their minds, though it will certainly feel
good to the financial houses that get to dump their bad paper on the
government.
A serious intervention in which Washington takes charge would, first,
require a new central authority to supervise the financial institutions and
compel them to support the government's actions to stabilize the system.
Government can apply killer leverage to the financial players: accept our
objectives and follow our instructions or you are left on your own - cut off
from government lending spigots and ineligible for any direct assistance. If
they decline to cooperate, the money guys are stuck with their own mess. If
they resist the government's orders to keep lending to the real economy of
producers and consumers, banks and brokers will be effectively isolated,
therefore doomed.
Only with these conditions, and some others, should the federal
government be willing to take ownership - temporarily - of the rotten
financial assets that are dragging down funds, banks and brokerages. Paulson
and the Federal Reserve are trying to replay the bailout approach used in
the 1980s for the savings and loan crisis, but this situation is utterly
different. The failed S&Ls held real assets - property, houses, shopping
centers - that could be readily resold by the Resolution Trust Corporation
at bargain prices. This crisis involves ethereal financial instruments of
unknowable value - not just the notorious mortgage securities but various
derivative contracts and other esoteric deals that may be virtually
worthless.
Despite what the pols in Washington think, the RTC bailout was also a
Wall Street scandal. Many of the financial firms that had financed the S&L
industry's reckless lending got to buy back the same properties for pennies
from the RTC - profiting on the upside, then again on the downside. Guess
who picked up the tab? I suspect Wall Street is envisioning a similar
bonanza - the chance to harvest new profit from their own fraud and criminal
irresponsibility.
If government acts responsibly, it will impose some other conditions on
any broad rescue for the bankers. First, take due bills from any financial
firms that get to hand off their spoiled assets, that is, a hard contract
that repays government from any future profits once the crisis is over.
Second, when the politicians get around to reforming financial regulations
and dismantling the gimmicks and "too big to fail" institutions, Wall Street
firms must be prohibited from exercising their usual manipulations of the
political system. Call off their lobbyists, bar them from the bribery
disguised as campaign contributions. Any contact or conversations between
the assisted bankers and financial houses with government agencies or
elected politicians must be promptly reported to the public, just as
regulated industries are required to do when they call on government
regulars.
More important, if the taxpayers are compelled to refinance the villains
in this drama, then Americans at large are entitled to equivalent treatment
in their crisis. That means the suspension of home foreclosures and personal
bankruptcies for debt-soaked families during the duration of this crisis.
The debtors will not escape injury and loss - their situation is too dire -
but they deserve equal protection from government, the chance to work out
things gradually over some years on reasonable terms.
The government, meanwhile, may have to create another emergency agency,
something like the New Deal, that lends directly to the real economy -
businesses, solvent banks, buyers and sellers in consumer markets. We don't
know how much damage has been done to economic growth or how long the cold
spell will last, but I don't trust the bankers in the meantime to provide
investment capital and credit. If necessary, Washington has to fill that
role, too.
Finally, the crisis is global, obviously, and requires concerted global
action. Robert A. Johnson, a veteran of global finance now working with the
Campaign for America's Future, suggests that our global trading partners may
recognize the need for self-interested cooperation and can negotiate
temporary - maybe permanent - reforms to balance the trading system and keep
it functioning, while leading nations work to put the global financial
system back in business.
The agenda is staggering. The United States is ill equipped to deal with
it smartly, not to mention wisely. We have a brain-dead lame duck in the
White House. The two presidential candidates are trapped by events, trying
to say something relevant without getting blamed for the disaster. The
people should make themselves heard in Washington, even if only to share
their outrage.
--------
William Greider - National affairs correspondent William Greider has
been a political journalist for more than thirty-five years. A former
Rolling Stone and Washington Post editor, he is the author of the national
bestsellers One World, Ready or Not, Secrets of the Temple, Who Will Tell
The People, The Soul of Capitalism (Simon & Schuster) and - due out in
February from Rodale - Come Home, America.
<http://www.truthout.org/articles/by-author/external/William+Greider> >
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Comments
This is a moderated forum. It may take a little while for comments to go
live.
The
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17572> behavior of wall
Mon, 09/22/2008 - 19:43 - Anonymous (not verified)
The behavior of wall street--and those in washington who watched this mess
develoop-- has been pathological. No one who believes that ruining the
economy, destroying people's lives and security, and then asking--no,
demanding--to be rescued by the victims, lest even worse things happen, has
any business running anything. And the fact that American has gone along
with this makes me even sicker.
Read
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17543> "ShockDoctrine" by
Mon, 09/22/2008 - 17:00 - Anonymous (not verified)
Read "ShockDoctrine" by Naomi Klien and you will not only see why this
"economic crisis" just happened to come about, but you will also understand
why our trusted politicians are in such a rush to push through legislation
that will be the biggest corporate welfare bailout in our history and saddle
future generations with the bill. First cause the crisis (deregulation
started by Reagan) then instill fear (our whole economy will crumble) and
while everyone's in shock and vulnerable, enact binding legislation. The
wealthy and powerful will continue on their merry way, while the rest of us
are left to clean up their mess
As if
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17539> "TRUST ME" isn't good
Mon, 09/22/2008 - 16:30 - RSB (not verified)
As if "TRUST ME" isn't good enough, Hank also wants immunity from oversight
and potential prosecution if he is caught (god forbid) doing something
'kosher' with the taxpayer's money. Does anyone else wonder what portion of
the 'losses' reported were actually HARD-CURRENCY versus fractional banking
BOOK-ENTRIES ? At a ratio of 1:9 there is potentially a rapacious
return-on-investment from this 'bail-out' of 'friends' at home and abroad -
and none of this payout will be subject to oversight by anyone other than
Hank & Friends ? Sounds highly suspicious.
Recompense.
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17537> The way forward
Mon, 09/22/2008 - 16:23 - cheaptalker (not verified)
Recompense. The way forward should include guarantees that the people with
the money, specifically those who set up, lobbied for, or profited from this
specific morass will pay for it. I hope we will hear about plans to target
the folks who should pay for their excesses. Most likely we will just hear
whining and shouting as the GOP continues to muddy the already dirty waters.
Mon,
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17529> 09/22/2008 - 07:42 -
Mon, 09/22/2008 - 15:52 - samosamo (not verified)
Mon, 09/22/2008 - 07:42 - Bruce **Americans! The most-entertained and
least-informed race on the planet! Bruce** Great call! Could also be called
the 'standard of living' we po' souls have been taught to love so much and
which our government is doing so much 'good' to the rest of the world to
maintain this standard. You just don't throw away a vegged out population
that has been nurtured to such a sad state that it is now. Particular kudos
should go to our subverted conservative media in their part to give us
totally empty information and ideas that have all the fluff and glitz that
the masses crave.
This is
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17525> fascism, pure and
Mon, 09/22/2008 - 15:48 - Steve Newcomb (not verified)
This is fascism, pure and simple. Our government is now picking winners and
losers, the exact opposite of supporting a free market. It is spending the
people's money to *prevent* the marketplace from replacing the old, obsolete
financial businesses and business models with new ones. Tell your
Congressman that he/she can either be an accomplice to a fascist takeover of
America, or not. Truly, it is his/her (very lonely) choice.
Mr.
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17509> Greider would have us
Mon, 09/22/2008 - 14:03 - EMD, Los Angeles (not verified)
Mr. Greider would have us believe that this event, "will become a
transforming event in American politics - exposing the deep deformities in
our democracy and launching a tidal wave of righteous anger and popular
rebellion. With a functionally illiterate electorate and a corporate
monopoly on the vast majority of media, a popular uprising seems unlikely.
Pull American Idol from the airways, and only then you will be treated to
the sight of Americans, bloated and breathless lumbering onto the streets in
a mass of feckless protest.
"No time
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17500> to to read all that
Mon, 09/22/2008 - 11:56 - Mikey (not verified)
"No time to to read all that paperwork - just trust me. It's a great deal,
and the best you're going to get." I don't know if Paulson ever sold
subprime mortgages, but he sure knows the script!
This
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17497> bailout is nothing but
Mon, 09/22/2008 - 10:50 - Juanbaltimore (not verified)
This bailout is nothing but socialism for the big banks and brokerage
houses. But its not socialism like Sweden, China, or Russia. Its National
Socialism like in Nazi Germany, the unfettered control of the financial
assets of the nation. Brothers and sisters, we are in deep do-do.
This plan
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17495> gives a collosal
Mon, 09/22/2008 - 09:27 - Anonymous (not verified)
This plan gives a collosal ammount of power to the new economic czar over
the running of the US economy. Doesn't the creation of such a post, an
economic dictator, require a little more thought and reflection? It seems
like one is creating a 'de facto' paralell government or a corporate state
structure, where 'private' enterprise merely becomes a branch of the
all-powerful state, with precious little real democratic control. Democracy
as we know it, is whithering on the vine.
Well,
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17489> well, well. You
Mon, 09/22/2008 - 07:42 - Bruce (not verified)
Well, well, well. You Republicans who rail against government intervention
and deify free-markets will now have a field day as the American taxpayer
picks up the tab. Bravo! Hats off to All of Ye who brought Mr. Bush to
power! The Republicans kept your attention on lapel pins, abortion, rah-rah
cheerleading for "Dah Troops" as they pick-pocket the unknowing fools who
brought them to power. Alas! Americans! The most-entertained and
least-informed race on the planet! Bruce
I am just
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17486> a regular citizen
Mon, 09/22/2008 - 06:47 - Moongal6 (not verified)
I am just a regular citizen and not an economist. But , I can't help but
wonder, since we don't actually have to send a check ($2,000-$5000) to Mr.
Bush for the bail-out, isn't someone going to raise my taxes? Now, I
imagine, if Mr. McCain becomes our President, he is NOT going to raise taxes
on the wealthy Americans, 'cause that is who is spending campaign money on
him to make sure he gets elected. That way the free ride will continue. He
will raise taxes on the walkin' around people. Now, I also imagine if
Mr.Obama becomes our President, he is going to raise taxes on the people who
have enjoyed windfall profits these last 8 years. The ones who should be
paying their fair share.
Section 8:
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17485> "...
Mon, 09/22/2008 - 06:28 - Anonymous (not verified)
Section 8: "... non-reviewable and committed to agency discretion..." Enough
said.
Let me say
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17484> first, that I
Mon, 09/22/2008 - 06:07 - samosamo (not verified)
Let me say first, that I have yet to see in this reimbursement any mention
of regulations to put a halt to the thieves on wall street and in the
financial sector. And I have not seen anything about kicking the federal
reserve out of this country and stopping it from having any business or
power to our money system. Unless these conditions are met, I fail to see
any help to our economy which the above mentioned have everything in the
world to do with the depression we are falling into. Now, let us look at
this bailout that Mr. Complicit Paulson is not just pushing for but wanting
it ASAP or yesterday for some strange reason. And I think I will just play
with the $700,000,000,000.00 figure that is all over the news. First off,
for simplicity, that $700B represents what is lost or could be considered
that it is money that has changed hands and been tucked away for rainy days
for a few 'lucky' people. Now the way I see it, if it goes through,
Complicit Paulson being the mouth piece for the ones that think they can
cash out again for their inadequacies in managing the first batch of $700B
are hoping to get reimbursed for the first lost $700B which for their sake
comes out of our pockets but will have to be 'LOANED' to us by the federal
reserve which will charge their best interest rate. Do not confuse this with
a 2% rate or some such idiot %age figure like in a simple loan, best
interest is the people's whose money the federal reserve will use to
reimburse those inadequacies unable to function in their job description
which are the elite class and their interest rate will be just like a
mortgage loan where the final interest payment will equal or exceed the
original $700B loan to help out those inadequate bastards that will receive
a daily double if the bail out goes through. So , to sum up, there are 3
different $700B lump sums to consider here which in the end would be cool
$2,100,000,000,000.00 lost by the people but divvied up amongst just a few
crooks in the world. Just thought I would give an indication of what can
happen and the potential amount that will be involved. And to cover my ass,
that final $2.1trillion could be +/- $700billion. It has always been about
grand larceny. I have seen here where pelosi is against this which gives her
a slight break from all of us that still think impeachment of w & dick still
needs to be brought to the floor. I am watchfully waiting before I get too
excited about that.
There was
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17483> an old boxing
Mon, 09/22/2008 - 06:05 - pink elephant (not verified)
There was an old boxing movie. I think it starred John Garfield? During one
scene the working press confronts the the "newly formed" commission
investigating boxing. "Boxing was broken" the head of the commission tells
the gathered reporters, but now its fixed." This results in a flurry of
headlines declaring "Boxing Fixed." The current situation is not something
that should shock anybody; once again the fix is in. The only problems are
that: 1. This is no movie 2. What were the alternatives? Yesterday, it was
explained that Mr. Paulson only decided on the dramatic measures after the
data pouring in on his "radar" indicated that the banking system was
perilously close to a "ship wreck". It was fast approaching the the point
where the banks would simply not desire to or be able to continue extending
each other credit. If this were to happen, the whole system would grind to a
halt and businesses large and small would basically have little recourse
aside from barter to pay their day to day costs. The consequences of this
scenario would have proven so dire, that Mr. Paulson, a life long
Republican, free market disciple felt compelled to plunge in and effect a
rescue. Whether, Mr. Paulson is therefore to be considered a hero or the
greatest swindler of perhaps all time remains to be seen, but at this
moment, although it leaves an unpleasant taste in my mouth saying so, I tend
towards the former. Again, the magnitude of the current situation is so
large and the consequences to people and institutions both large and small
were so perilous, should the system have failed, that something had to be
done. Really, all we the people can now do is try to understand how things
got so out of hand and hope the wise men prevent it from happening again. We
are ensnared in a conundrum, where we want to root against the fat cats but
are obliged on the other hand to cheer a bailout-engineered to be sure by
persons less than savory if only to see our own asses saved. So is boxing
fixed? Answer: yes it is. What is one to do? Answer: watch wrestling.
I believe
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17480> that this
Mon, 09/22/2008 - 05:09 - Anonymous (not verified)
I believe that this financial crisis has been carefully staged since, at
least, 2006, by "the so called new world order, skull & bones boys club. In
2006, I was told to get my finances in order and get off shore, before the
"financial meltdown/US take over of the financial system, is put into place
before the election. All the details disclosed to me have come to pass.
As I see
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17478> it, there are two
Mon, 09/22/2008 - 04:58 - David Brookbank (not verified)
As I see it, there are two problems which in combination make it impossible
for the U.S. populace to rise from its paralysis to force the changes
Greider recommends -- or any changes for that matter which benefit the
people of the country. As I have long argued, the U.S. populace is
essentially a captive non-player, long, long ago side-lined. What are the
two problems to which I refer above: 1) a lack of ability to do one's own
analyze and reach one's own conclusions without everything being filtered
through the pundits, "experts", politicians, "news media", etc. 2) a
debilitating emotional decapitation which prevents us from expressing the
emotional part of the outrage we feign in mild-mannered conversations, in
"rational" blogging, etc. Whether out of modesty; fear of being portrayed as
out-of-control or, worse, crazy; or fear of being tasered; etc., we have
lost the ability to connect emotion to action. In the absence of an analysis
that we have reached through our own personal "ruthless criticism of
everything existing" and a visceral connection of that analysis to the
physical world in the form of ACTION, forget about it, my friends. IF YOU
THINK THAT THE GOVERNMENT -- CURRENT OR FUTURE--OR THE PRIVATE SECTOR, OR
ANY COMBINATION OF CAPITALIST/IMPERIALIST RULING CLASS SCUM IS GOING TO
RESCUE YOUR SCARED ASS, FORGET ABOUT IT. Time to act...if you have the
intellectual capacity and the courage of conviction. I for one doubt it.
I don't
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17473> want one dollar of
Mon, 09/22/2008 - 04:25 - Anonymous (not verified)
I don't want one dollar of that $700B to go to the crooks on Wall Street.
Use it all to help lower income people facing foreclosure by giving them low
interest, fixed rate loans that allow them pay off their "toxic" debt. High
income (or high net worth) speculators can lose their houses if they didn't
know better than to get a subprime mortgage. They will always be able to
find a place to live. It is the people that are struggling that need to get
the help.
The
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17472> greatest transfer of
Mon, 09/22/2008 - 04:19 - Anonymous (not verified)
The greatest transfer of wealth out of the hands of the payroll class into
the hands of the asset class, in the history of man, is just about
completed. If you didn't know it was happening you are now going to pay for
your ignorance. There were plenty of warnings you just didn't listen or
maybe you were just too ignorant to care. Forget about trying to make sense
of it. There were ways you could have protected yourself and prepared. To
late now. Just substitute the word Iraq or WMD for Failed Financial
Institution, listen to the rhetoric about how dire our situation is, and
maybe you'll get it. And if you still can't figure it out, go to UTube and
check out the Money Masters or maybe George Carlins Who Owns America. Listen
and weep, get angry, do whatever, doesn't matter it's all almost over.
Sorry. Good Luck.
Hey I got
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17467> an idea. Why don't
Mon, 09/22/2008 - 04:01 - Anonymous (not verified)
Hey I got an idea. Why don't you let me push paper around and make myself as
much money as I want. Now say I'm running a pyramid and know eventually the
whole thing will collapse. Once things begins to crack, I say, "Hey, I
screwed up, so can u cover my losses?" And the Fed and Secretary of the
Treasury say, "Yeah, sure. But we'll get whatever we can out of our 'loans'
to you, to prevent the crisis." "Yeah, to prevent the crisis," I say. then I
proceed to so totally screw up the companies I control, sell every penny of
what I have in them, and leave whatever 'profit' left to the taxpayer. By
then I'm gone with all the millions I made, probably off-shore paying zero
in taxes. Loaning to a crashing or bankrupt company WILL NEVER be
profitable! If it were, the private sector would buy in at bottom prices and
not leave it to gov't. You readers are insane to see any potential upside,
what are you bankers?
No. Saying
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17466> "no" to all
Mon, 09/22/2008 - 03:51 - JBPeebles (not verified)
No. Saying "no" to all buyouts. Why does the government have to spend any
money? Let the fat capitalist pigs eat it. Raise their taxes to pay for all
their damage to the system. Everybody making over $250,000 should have to
pay for all the tax breaks they've been getting under Bush. All these
companies off-shoring shouldn't be allowed to sell their junk here. Slam the
door on "Free" Trade that isn't fair. Build it here or pay a duty--this is a
sensible course of action for government. Federalizing or nationalizing will
do nothing except transfer the losses to the public. All these financial
companies are toxic. Let 'em burn. So what if a bunch of Little Eichmans
will have to sell their third home in the Hamptons. Hey, the Little People
will suffer, but hey Janis Joplin said, "freedom is nothing left to lose!"
Can anyone
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17454> tell me what will
Mon, 09/22/2008 - 01:27 - Anonymous (not verified)
Can anyone tell me what will happen if the money guys default. Should I hire
a moving van? Maybe I should just wait to see what else happens? The current
administration is a laugh a minute. What ever happened to outrage and
stunned shock? Where are the Democratic cries of horror and dismay at the
destruction of our Republic? I now, all you smart guys are gonna say 'how
naive.' At least I sleep at night and have my convictions intact.
So, let me
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17452> get this
Mon, 09/22/2008 - 01:15 - SFRider (not verified)
So, let me get this straight: After 9/11 Bush encouraged everyone to go
shopping. Borrow if need be. Don't worry about the future; the economy is
strong. Oh yeah, home ownership is the highest ever in America. Even if on
borrowed money! Low interest rates -- if you are lucky enough to qualify --
will keep the economy humming. And if not, don't worry; everything keeps
going up. Your appreciating assets will cover your debts. Lending
institutions show fantastic profits, on paper, and the management geniuses
who organize this trip are roundly rewarded with multi-million-dollar
compensation and retirement packages. Meanwhile, we start an unnecessary war
and charge it. Borrowing from the rest of the world to cover the expenses.
We lower taxes on the highest income earners. Further rewarding them for
their genius. Oops! We were wrong; it doesn't go on forever. But we can't
afford to let these lending institutions that miscalculated fail. So we'll
bail them out by taking the bad loans off their books at taxpayer expense so
they can continue lending and hopefully restore the economy to its previous
vigor. Isn't this a vicious cycle? Why do we expect a different outcome the
next time around with the same foxes in charge of the chicken coop? How
about: Instead of bailing out these institutions that have made such bad
decisions, we just let them deal with their problems and instead protect the
corporations, taxpayers, and ordinary American's who stand to suffer because
of their mismanagement? Instead of bailing out our failed institutions, why
not set up new institutions with a set of rules that will prevent similar
abuses? Provide ready credit to corporations for operating expenses, provide
affordable martgages for strapped homeowners to refinance and pay off the
ones they can't afford so they can keep their homes, provide affordable
loans for consumers to refinance their exhorbitant credit card debt. Then
let it all work itself out. If we're going to use taxpayer dollars to solve
the crisis, shouldn't we do it in a way that benefits first the taxpayers
who are paying for it, and only after that helps to preserve the failed
institutions that got us into this mess to begin with?
It seems
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17449> to me that if the
Mon, 09/22/2008 - 01:13 - Anonymous (not verified)
It seems to me that if the goal is to "revitalize the economy" the bailout
of the crooks on Wall St. is unnecessary. Why not assure the money supply
and encourage the regulated commercial banks in every town to make sound
loans at reasonable rates and let the thieves on Wall St. find their own
road to hell. I'll take a hit in a bad market but hey, in every life a
little rain must fall. This deal is a SWINDLE ! I'll get off cheaper by
taking the hit now.
any
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17447> bailout should be in
Mon, 09/22/2008 - 00:19 - Anonymous (not verified)
any bailout should be in exchange for the impeachment and imprisonment of
Bush, Cheney. Rice & Rumsfeld, probably for 10 cents on the dollar.
What
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17444> Greider and everyone
Sun, 09/21/2008 - 23:38 - Greg Gerritt (not verified)
What Greider and everyone else seems to be ignoring is that the
financialization of the economy is taking place due to the ecological
collapse of the system. Until we stop using oil, reverse deforestation,
restore our soils, and heal the oceans the economy will continue to crash,
and Wall St will continue to do crazy things to make money. There is no
longer a real economy to invest in. Therefore stop the war machine and stop
the financial games and turn Green.
What is
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17442> wrong with the
Sun, 09/21/2008 - 23:03 - bill (not verified)
What is wrong with the government buying all this toxic debt with a put at
the purchase price. The government would have to wait a minimum of say one
year and could only put the debt back to the institution if the institution
was making money. Perfect for the government. They own all the upside and
the financial institutions have to take back the toxic debt a little at a
time over a period of times.
I am
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17440> certainly not an
Sun, 09/21/2008 - 22:51 - marina (not verified)
I am certainly not an economist by any stretch of the imagination. I do know
that when I make unwise fiscal decisions, I and I alone have to face the
consequences. The thought that has absolutely bedeviled me all week is who
is going to monitor the so-called overseers/rescuers? Congress does need to
take a very deep breath and ask the same question, as "significant problems
cannot be solved at the same level of thinking with which we created them."
Thank you, Albert Einstein!
It is the
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17434> end of the
Sun, 09/21/2008 - 22:30 - Steve (not verified)
It is the end of the McKinley Reagan era. President Reagan tried to re run
the McKinley experiment. Drive down wages, deregulate finance, mix
commercial and investmnet banking, reduce bankruptcy proection, allow
unreasonable levels of finacial leverage, reduce socail safety nets such as
retirement health care, workers compensation, and reduce marginal tax rates
for those who benefits from this social engineering. Not surprizingly we
have discovered that this experimenmt failed with McKinly and has failed
again. What must chagrin the architects of this system is that it is
resultingin the greatest nationalization offinaciual resources we have ever
seen. Franklin and teddy Roosevelt reformed our financial system and
preserved it. Reagan, Clinton and Bush turn out to be the most radical
leaders of the last hundred years. They just did not predict the outcome.
These
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17420> speculative banks,
Sun, 09/21/2008 - 21:42 - Anonymous (not verified)
These speculative banks, insurance, and brokerage companies are leveraged at
the rate of 30 to 1. So for every 3 dollars in capitalization there is $97
in debt. So the working class taxpayers buy all the "bad" debt meaning debt
from wealthy speculators which will never be repaid. The bailout in 1933 was
very different as the government bought mortgages that were backed by real
estate. This is not the case with this situation which is why the
Republicans and their campaign contributors want this rushed through
Congress with no debate and no strings attached.
Greider
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17418> has written an
Sun, 09/21/2008 - 21:36 - Shea Brown (not verified)
Greider has written an insightful article with some great suggestions.Will
this article reach anyone in Washington,or even if it did, would it be read
with an open mind, or have the lobbyists of the financial industry already
created their magic?We should all forward this article to as many
representatives as we can,and quickly. The CEO's and sales agents for these
banks have already earned their commissions.It was their mistakes that
caused this crisis.Let them be the first to pay a penalty.What salary and
bonus package will the CEO of AIG receive this year?I suggest not a
dime.They put us into this mess ,let them pull a little cash out of their
accounts to help ease the burden. Everyone would do well to read Chalmers
Johnson's article,"How to Sink America."What he predicted months ago is our
reality today.It is the most illuminating article that I have read in
several years.
"The
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17414> scandal is that
Sun, 09/21/2008 - 21:10 - Milton (not verified)
"The scandal is that government is not acting forcefully enough..." " If
government acts responsibly" Sorry that isn't possible ... this is throwing
us further down the tubes. There were be no protests and we will take this
in the butt just like everything else.
All this
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17412> money went into
Sun, 09/21/2008 - 21:06 - Richard Cummings (not verified)
All this money went into these derivatives because the American GDP is 60%
consumer spending and 40% real estate. Real estate was where the money was,
so that's where the investments went. This is no way to run an economy. It
is high time capital was redirected to our manufacuring sector. It the banks
won't do it, that's where the government should put its money. Americans
need so stop spendng and start saving. We need a sound dollar and fewer
importa. If American stop spending, we will import less, the balance of
payments will improve and the dollar will become stronger. Without this,
there is no rescue plan that will work. But I am inclined to think, contary
to Bill Greider, that Americans are too placid to do anything like withdraw
support from the politial parties or start a new one. The best I would give
the American people is a 15% approval rating. That's the heart of the
problem. There are just too many Americans who are ill informed and badly
educated. Under these conditions, they will fall for propaganda and then
sulk.
"a hard
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17410> contract that repays
Sun, 09/21/2008 - 20:46 - Anonymous (not verified)
"a hard contract that repays government from any future profits once the
crisis is over." Tens, maybe hundreds, of billions of dollars of 'profit'
were made trading nothing with any intrinsic value, namely paper. Is this a
great country or what? But, the notion that the wise guys who came up with
this scheme will work for wages, is nonsense. Back to the drawing board. By
the way, this was a great article. Comprehensive, intelligent, forceful, et.
al, but will NOT be read and acted upon by pols and bureaucrats - unless
there is something in it for them. Welcome to the United States of Cannon
Fodder.
Wonderful
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17409> article and darn
Sun, 09/21/2008 - 20:41 - Inge Perreault (not verified)
Wonderful article and darn right;, if as Michael suggests the taxpayers are
compelled to refinance the villains in this drama, Americans at large are
entitled to equal treatment. Does anyone ever think that the Savings and
Loans debacle the tax-payer ended-up funding was just a trial-run of the
present culprits? If the American population at large takes this "laying
down" I will be more disenchanted with my fellow Americans than I have ever
been. And what about our judiciary system? Did anyone ever possibly consider
to take the enormous funds that were virtually STOLEN out of the deep pocket
of those who devised the devious schemes in the first place, punish them and
take the earnings of the CEO's applying them to the accumulated debt leaving
THEM to experience looking for a job, shopping at discount stores because
their fancy homes, yachts and properties have been seized? THEY DID WRONG
and now "Uncle Sam" in form of corrupt government officials, is picking up
the pieces and dumping them on the average American tax-paying citizen? I
should be very surprised if once the unemployment figures and foreclosures
reach a certain point, the rightful anger will not create a serious backlash
against those responsible, be it in the economic sector and/ or the
political sector. The American people have every right to be angry, furious
would probably be a better description of how they should feel.
There are
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17402> two pieces of info
Sun, 09/21/2008 - 20:24 - JohnEndwar (not verified)
There are two pieces of info I would like if someone out there knows: First,
why is no connection being made between "The Three Trillion Dollar War" on
Iraq and Afghanistan and this crisis. At the very least that debt added to
the trillion or more (certainly more) will lead to even more inflation (yes
more since the dollar is worth about 2/3 of what is was two years ago). And
that will be paid by you and me and fall especially hard on the elderly and
retirees. Second, do pension funds hold some of the "bad paper" and will
they be protected?
why doesnt
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17395> the government
Sun, 09/21/2008 - 19:55 - Anonymous (not verified)
why doesnt the government just allow the home owners going into forclosure
to get reasonable fixed interest loans? this save the homeowners and hits
the investment criminals with a lower interest--but stable-- portfolio.
Why does
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17389> no one talk about
Sun, 09/21/2008 - 19:23 - Anonymous (not verified)
Why does no one talk about the massive conflict of interest with Czar
Paulson and his $300mm+ of Goldman Sachs stock that he is trying to protect
with this massive abuse of power. He is more powerful than any emperor.
It's all
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17384> so very Faustian.
Sun, 09/21/2008 - 19:03 - I AM (not verified)
It's all so very Faustian. The thing is you can't sell your soul. You ARE
your soul.
You're
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17383> politicizing too
Sun, 09/21/2008 - 19:00 - Brain (not verified)
You're politicizing too much; yet another compromise for a much ballyhooed
"soft landing." The system needs to correct itself in an honest &
transparent fashion - also known as a "crash." This means that those who hit
hardest should get hit the hardest. This also means real sacrifice, real
blood being let by all parties - Wall St., Main St. & Capitol Hill. Anything
less & the spoiled children earn nothing but a lesson still yet learned. You
also fail to mention - after the bailouts of bank, business, bumpkin & their
respective mothers - who is going to be the bailor of last resort; when
there is, has been, and will be only one real candidate - Joe Sixpack & Co.
And we, sir, like the leaders we elect, and the swindlers we neglect, are
too brain dead to carry the day.
I could
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17380> not agree more. If,
Sun, 09/21/2008 - 18:44 - Mike Farrace (not verified)
I could not agree more. If, as Paulson said this morning on "Meet the
Press," there is a possible upside when these loans are resold, let's make
sure taxpayers are the beneficiaries, not the brokers and agents who have
already profited twice. And I'd love to see transparency on this issue, like
a website with a list of every bank getting help, who their bad loans were
re-sold to and for how much, and what the profit or loss was for each. And,
I don't think any of the banks benefiting from taxpayer funds should be able
to buy back any of the bad loans at a discount. I'm tired of feeling like a
powerless victim as the country's debt and the people's tax burdens
skyrocket while credit and jobs dry up and the value of property plunges.
America is
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17379> so remarkable its
Sun, 09/21/2008 - 18:40 - Kashilinus (not verified)
America is so remarkable its naivety and generosity. We bid bon voyage to
the architects of unparalleled fraud and mismanagement as they depart with
their gazillion dollar golden parachutes. In China they execute them.
Something in between is called for - maybe a wall of shame where they would
be challenged by performance during the remainder of their lives to have
their names removed. Otherwise they would remain chiseled in for an
eternity.
Good
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17377> article, I particularly
Sun, 09/21/2008 - 18:34 - Michael (not verified)
Good article, I particularly like the statement, "...if the taxpayers are
compelled to refinance the villains in this drama, then Americans at large
are entitled to equivalent treatment in their crisis. That means the
suspension of home foreclosures and personal bankruptcies for debt-soaked
families during the duration of this crisis." It displays rare fairness and
directness. Also, it is worthwhile to read the 10-point plan that Ralph
Nader, a prescient observer of this crisis from it's early days in 2000, has
developed with his colleagues. "The people should make themselves heard in
Washington, even if only to share their outrage." Yes.
It would
<http://www.truthout.org/article/paulson-bailout-plan-a-historic-swindle#com
ment-17374> be helpful to me
Sun, 09/21/2008 - 18:30 - Mark (not verified)
It would be helpful to me and I imagine many others for someone to create a
flow chart of the different scenarios being offered as solutions to the
current financial crisis. These charts should follow the money and the
consequences, good or bad, from the top to my house and my income, and my
small business. I pretty well understand the surface of most of the plans
being offered but sorting through the words is difficult. A graphic
representation would be more helpful to me do decide what I thought was best
and most fair. I could then let my political Representatives and Senators
what I supported. It would also help me make a choice in the Presidential
election. Thanks to whoever does this.
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