I spent the weekend preparing for my move cross country, which I have been alluding to here for a while. I will finally be posting about it later this week. What I can tell readers now, is that the planned move has arisen out of the financial crisis our country is in.
As I noted here last Monday when the news started emerging on how deep the crisis is, as a “small business owner, I’ve watched my sales slide downward for the past couple of years.” I’ve reached a point that simply put, if I want to stay in business, I need to move somewhere that is more economical to live. That said, let’s talk about that blank check that Bush administration and the Feds are asking for, because the consensus has been growing over the weekend that this might not be such a bright idea…
On Sunday, Congressional Democrats started to “set their own terms” for a bail out plan “to rescue the nation’s financial institutions, including greater legislative oversight of the Treasury Department, more direct assistance for homeowners and limits on the pay of top executives whose firms seek help.”
The bail out from the Bush administration “could be the largest government bailout of private industry in the nation’s history, and it calls for nearly unfettered powers to the Treasury secretary,” and it’s the “unfettered” powers being bestowed on the Treasury secretary that has some lawmakers questioning the consequences.
In fact, both Barack Obama and John McCain, “who face the prospect of inheriting an enormous new program, said there had to be more oversight of the Treasury Department than the Bush administration had proposed.” And of course, the giant financial companies (corporate ho’s) are “lobbying for wider aid.”
House Speaker Nancy Pelosi has said, “We will not simply hand over a $700 billion blank check to Wall Street and hope for a better outcome.”
Robert Reich wrote yesterday on TPM Cafe:
The public doesn’t like a blank check. They think this whole bailout idea is nuts. They see fat cats on Wall Street who have raked in zillions for years, now extorting in effect $2,000 to $5,000 from every American family to make up for their own nonfeasance, malfeasance, greed, and just plain stupidity. Wall Street’s request for a blank check comes at the same time most of the public is worried about their jobs and declining wages, and having enough money to pay for gas and food and health insurance, meet their car payments and mortgage payments, and save for their retirement and childrens’ college education. And so the public is asking: Why should Wall Street get bailed out by me when I’m getting screwed?
President Bush is “asking for a huge amount of power,” said Nouriel Roubini, an economist at New York University who was among the first to predict the crisis. “He’s saying, ‘Trust me, I’m going to do it right if you give me absolute control.’ This is not a monarchy.”
Paul Krugman had this to say:
Some skeptics are calling Henry Paulson’s $700 billion rescue plan for the U.S. financial system “cash for trash.” Others are calling the proposed legislation the Authorization for Use of Financial Force, after the Authorization for Use of Military Force, the infamous bill that gave the Bush administration the green light to invade Iraq.
There’s justice in the gibes. Everyone agrees that something major must be done. But Mr. Paulson is demanding extraordinary power for himself — and for his successor — to deploy taxpayers’ money on behalf of a plan that, as far as I can see, doesn’t make sense.
Some are saying that we should simply trust Mr. Paulson, because he’s a smart guy who knows what he’s doing. But that’s only half true: he is a smart guy, but what, exactly, in the experience of the past year and a half — a period during which Mr. Paulson repeatedly declared the financial crisis “contained,” and then offered a series of unsuccessful fixes — justifies the belief that he knows what he’s doing? He’s making it up as he goes along, just like the rest of us.
Krugman also noted that “after having spent a year and a half telling everyone that things were under control, the Bush administration says that the sky is falling, and that to save the world we have to do exactly what it says now now now.” And he said, “I’d urge Congress to pause for a minute, take a deep breath, and try to seriously rework the structure of the plan, making it a plan that addresses the real problem.”
Don’t let yourself be railroaded — if this plan goes through in anything like its current form, we’ll all be very sorry in the not-too-distant future.
Kevin G. Hall asked in McClatchy News, “Can you trust a Wall Street veteran with a Wall Street bailout?”
Making the rounds on the Sunday morning talk shows, Treasury Secretary Henry Paulson repeatedly said today’s financial problems were long in the making. He should know. He was part of the Gold Rush that has brought the global financial system to the brink of collapse.
Paulson presided over one of the most profitable runs on Wall Street as chairman and chief executive officer of investment banking titan Goldman Sachs & Co. from 1999 until President Bush nominated him on May 30, 2006 to take over the Treasury Department.
Is there not some irony that “the Fed has approved Goldman Sachs and Morgan Stanley’s requests to become bank holding companies,” given Paulson’s former ties to Goldman? Take a look at who we’re bailing out:
In 2007, Wall Street’s five biggest firms— Bear Stearns, Goldman Sachs, Lehman Brothers, Merrill Lynch, and Morgan Stanley – paid a record $39 billion in bonuses to themselves.
That’s $10 billion more than the $29 billion loan taxpayers are making to J.P. Morgan to save Bear Stearns.
Those 2007 bonuses were paid even though the shareholders in those firms last year collectively lost about $74 billion in stock declines –their worst year since 2002.
Let’s get real. There is no way in hell that the Bush administration should be handed another blank check by Congress. Look where blank checks to Bush[Co] have gotten us already. People’s lives are being ruined by this financial crisis. Large corporations are getting bailed out all over the place and most small businesses can’t even get SBA loans to stay afloat. The unemployment rate is up. Consumer confidence is in the toilet.
We can’t trust the Bush administration to fix this. Call Congress, call your Reps, call your Senators and demand “No Blank Check.” Last but not least, it should go with out saying at this point, when it comes to the November election, a vote for McCain is a vote for “more of the same.” We simply can not afford “more of the same.”