Bailout Deal: Fueled by Fear and Hinged on Haste

Economy
Democrat Doggett On Saying No To Bailout Bill

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Day to Day, September 29, 2008 · The House of Representatives rejected the $700 billion bailout plan Monday. Rep. Lloyd Doggett (D-Texas) was one of 228 congressmen who voted against the plan.

"I listened to my constituents and to my own thinking that now is not the time to call on people across the country to bail out Wall Street," he told Madeleine Brand shortly after the vote. "I thought this was very much like the Iraq War, like the Patriot Act, like several other things in Congress that had been fueled by fear and hinged on haste. This was really one idea about how to address this problem to the exclusion of all others."

He said he felt a "sense of urgency to act," but he felt frustrated by hearing "our ideas for alternatives rejected."

He offers his suggestions for what Congress could do today to help solve the problem.

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Nation
Oregon Democrat DeFazio: Bailout Bill A 'Fake Lease'

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All Things Considered, September 29, 2008 · The House of Representatives rejected the $700 billion bailout plan Monday. Rep. Peter DeFazio (D-OR) was one of 228 lawmakers who voted against the plan — and said he was stunned it failed, even though he voted against it.

DeFazio told NPR's Melissa Block that there are "credible alternatives out there," and "this was never a slam dunk."

"It was a fake pay for — a fake lease," DeFazio said. "It said five years from now a president will propose to Congress a way to pay back the taxpayers. That's ridiculous. There could be a real sea on stock transactions that would pay for the cost of this bill.

"It did take away golden parachutes, and then instead it gave execs camouflage parachutes — you know, loophole written. The Republican insurance part was very dangerous, and it still gave phenomenal clout — unprecedented clout — to this treasury secretary and appointee of George Bush. And should we trust these people as far as we can throw them?"

As the final votes were tallied and the markets dropped, a few members of Congress were trying to get those who voted "no" to change their vote.

DeFazio called the pandemonium "absurdity."

"How could anybody change their vote on something as important as this?" he said. "I hope everyone voted on whatever side they were on with tremendous conviction. I told them to calm down a little bit. Markets go up, markets go down, you know, we can come back with a more reasonable proposal."

http://www.npr.org/templates/story/story.php?storyId=95187278


Economy
Will Rescue Package Stabilize The Markets?

by Jim Zarroli and Steve Inskeep

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Morning Edition, September 29, 2008 · After a weekend of tense negotiations, lawmakers produced a $700 billion rescue package for Wall Street. The legislation includes limits on executive pay, oversight and a deal-sealing plan for eventually recouping losses. However, no one knows for sure whether that will be enough to stabilize the markets.

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Listeners' Comments: Will Rescue Package Stabilize The Markets?


Stuart Smith (Carefarm) wrote:

Public Funds for Asset Acquisition I say; Government must not engage in Asset Acquisitions, except to recover Government funds wrongfully distributed or used. No market, public or private assets should be acquired by Government with tax payer funds. Much pain, decontamination and correction is needed and must occur to repair the years without restraint, transparency and regulation to bring a more sustainable market. The Government must not interfere, to do so will only prolong the decontamination process. The largest sector of the population my middle class (30k to 80k) has little or no market exposure. I don’t know Washington’s middle class 80k plus per year. Little attention has been paid to the poor and my middle classes for years now. My middle class only uses banks for checking and have no market assets or retirement. Health care, energy, housing, food and education cost and problems have plagued all those earning less than 80k. The sick financial contamination and failed responsible parties of government need cleared out and restructured for sustainability. There will never be a shortage of businessmen or politician to fill the void. Anyone earning 80k or more can weather the storm without help. The poor to middle class people do not want Government to assist wall street. The wealthy are the cause of the problem and need brought down to a more sustainable level. So given the above, government would become the problem prolonging the cure by buying asset? Governments only role would be to prevent another blowout with proper regulations.

Monday, September 29, 2008 6:23:10 PM Recommended (2)


Richard Savary (yankee2) wrote:

I am not an economist, but I don't think they know either. However, the package that the House rightly rejected this morning did not deserve to pass. It failed to recognize that the finance industry is not the only entity which is crashing. There are also the homeowners, especially anyone who bought a home about 2 years ago, right before the bubble burst. That bubble was not created by home buyers, and we had no idea if it was real, or if it would ever burst. All we knew is that we needed a home. Any package that bails out rich finance companies, while letting us be thrown out, deserves to fail. If American taxpayers will lose their homes because of finance company greed and malfeisance, and the government serves them without serving us, first, then I don't care if the economy goes all the way to bloody hell! This problem could be dealt with from the bottom up, taking care of taxpayers, homeowners, and ultimately the finance industry, by bailing out homeowners first. I want to know why that is not even being considered. I know I'll settle for nothing less!

Monday, September 29, 2008 6:06:38 PM Recommended (2)


Ben Shepard (Ben.1) wrote:

If the economy needs a bail out; let’s deliver it via the tax payers rather than the banks. Let’s inject liquidity using something similar to the economic incentive package by using “Stimulus Payments" of about $5,000 per tax payer. This number is calculated by dividing the proposed $700 Billion by the approximate number of U.S. Taxpayers of 138 Million yielding $5072 per tax payer. (Of course this number would be a little higher if we left out the million or more mortgage holders that are, or soon will be, in default on their loans; after all, they and corrupt financial industry representatives are responsible for this problem.) The recent “Stimulus Payments" of $600 proved to have some beneficial effects; perhaps giving $5000 to each tax payer would yield a very dramatic effect. Now it is clear that not all of the money would be put into the banking system, but much would. Many of us are more than a little concerned about our individual financial futures and we will put the entire amount into savings. This would represent an injection of liquidity into the banking system. Some of us would like to reduce the burden of our home mortgages and/or other debt and use the money to pay down these loans. This would also have the effect for injecting liquidity in that it would free up dollars in the financial system. And still others would simply spend the money doing what Americans do best, consuming as usual. This will have the effect that was desired for the current $600 “Stimulus Payments". My personal feelings are that this situation was caused by greedy financial companies, et al., providing loans to people who probably knew they were getting in over their heads but were gambling that they could pull it off and now they find themselves facing the cold hard truth that they gambled too much and lost. You could argue that the root cause was deregulation; and perhaps you’d be correct. But, it was unethical and/or risk-taking individuals who abused the lack of regulation, and they should be the ones paying the price. That is why I believe it would be better to provide liquidity via tax payers—responsible tax payers—and leave the banks and their high-risk debtors to work things out without direct Government (tax payer) help.

Monday, September 29, 2008 5:30:58 PM Recommended (3)


Jennifer Antoniou (bystander) wrote:

I thought the whole part of trading and investing in the stock market, and financial sector was all about calculated risks.... How is it that they didn't see the writing on the wall?! They were greedy and knew what they were doing with these bad loans. They took the risks... and now WE have to bail them out?! This administration needs to be impeached!! You know the the CEO's will walk away with fat checks- compliments of the American tax payer. They are using fear to scare citizens by saying that we are going to lose our future securities and retirement funds, and turning it around and putting the blame on us. When that is going to happen either way. There are other ways to get around this issue and a bail out is not one of them.

Monday, September 29, 2008 11:29:03 AM Recommended (9)


Stanley Merritt (Monk) wrote:

What sense does it make to buy the bad debt from a failed business? Without fundamental changes to their business policy this situation is primed to occur again. Why not write out mortgage waivers to citizens of the failed groups, thereby liberating the peoples' money, allowing them to participate in the economy? Oh wait... Outsourcing will still drive all our funds to other countries, that is except for the pay returning for the corporate heads. This problem is much larger and denser then the government wishes to acknowledge.

Monday, September 29, 2008 10:38:32 AM Recommend (5)


Lamar Lawrence (Dugan) wrote:

Where does the $700B go? Why is the bailout necessary this time when the S&L banks that failed during the Carter Administration was not? I suspect there are going to be a lot more billionaires world wide when this bill passes!

Monday, September 29, 2008 9:25:27 AM Recommended ( 8 )

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