What do you think about the $700 billion Wall Street bail-out?
We don't pretend to have the national financial crisis all figured out, but we know that members are talking about it. Central Kentucky member Danny Cotton vents his frustration with it on Facebook, wondering at "bailouts that include checks with more zeroes than I ever seen," and, in offering an idea for a solution, challenging the thick CEO paychecks (which the proposed bail out plan doesn't seem to challenge at all). Other members are also sending around resources, thoughts, and snippets of conversations, all drawing out the themes that resonate with our work: wealth inequality, the stunning ability of our political leaders to work together to help the powerful and the wealthy, the lack of strong government regulation of a very powerful interest group, and the familiar position of funding dubious investments that seem to benefit corporations over families.
We hope you'll share your thoughts, questions, and frustrations here, where we can all help each other figure it out!
There are oodles of resources, articles, and interviews out there. Many of them claim to help us understand the crisis, and about as many focus on different aspects of the crisis! Still, here are some that KFTC members have found helpful:
- NPR's Planet Money has a collection of interviews and snippets from other sites that, collectively, flesh out a story of how the crisis came to be, and how Congress is (and should) navigate the bail-out.
- $700 billion is a *lot* of money. An interesting column in Forbes offers "Seven Better Uses For $700 Billion." Some of their ideas?
- Invest it in our infrastructure, building safe bridges and large-scale public transportation projects.
- Invest in solar energy projects, and when we start earning a return on that investment, invest in other clean energy projects.
- Invest in health care! Give people access to health care (fair warning...they're not talking about single-payer, but it's still worth reading), and invest in finding and giving people access to cures for our most overwhelming ailments. The article points out that the National Cancer Institute gets $5 billion a year in funding. Could it do more with more than 100 times that amount?
- A column from NY Times columnist Bob Herbert. Herbert asks, "Does anyone think it’s just a little weird to be stampeded into a $700 billion solution to the worst financial crisis since the Great Depression by the very people who brought us the worst financial crisis since the Great Depression? How about a second opinion?" Herbert's article questions Henry Paulson's rush and urges the exploration of solutions that work for regular people (or at least that don't inspire Wall Streeters to jump up and down in ecstasy). (Herbert points out that Paulson, the Treasury Secretary, "was telling us during the summer that the economy was sound, that its long-term fundamentals were 'strong,' that growth would rebound by the end of the year, when most of the slump in housing prices would be over.")
- "Crash Course in Economics," a column by Larry Beinhart. (Beinhart wrote Wag the Dog, by the way, and has a bunch of other impressive creds.) This very accessible, non-jargony column challenges some of the narrow finger-pointing,broadening the context for why we're in this mess (including the Bush tax cuts for the super wealthy, the war, artificially low wages, and global free trade), and proposing a set of solutions that restore a functioning government for the people.
- Alternet.org also has a collection of helpful articles. Look around, but maybe start with "10 Things You Should Know about Bush's Trillion Dollar Fleecing Plan," a collection of themes that are surfacing from the critics, and links to fuller articles and explanations.
If you have other suggestions, feel free to post them in a comment! And even if you don't dip in to any of these, let others know what you think about bailing out Wall Street!
The case for good government
It unfortunately predicted exactly what is happening now with the financial markets and also predicts that the solution is a new economic bubble based upon alternative energy. The author, Eric Janszen, seems to present these bubble cycles as an inherit problem of our economic system.
Democracy and Capitalism are most often at odds with each other, and America, since its inception has struggled with balancing the two.
It is WRONG!
It’s horrible. What’s coming form the the administration is deplorable. It does not hold the Wall Street CEOs accountable, and does not put any regulations on them. And it hands over too much power to the administration. This will affect ordinary citizens, and it is WRONG!
What could $700 billion buy?
According to a report by the Apollo Alliance,Energy for America:The Apollo Jobs Report,http://www.apolloalliance.org/downloads/resources_ApolloReport_022404_122748.pdf
Detailed analysis of the potential economic benefits reveals that $30 billion investment per year for 10 years would provide the following benefits:
• Add more than 3.3 million jobs to the economy
• Stimulate $1.4 trillion in new Gross Domestic Product
• Stimulate the economy through adding $953 billion in Personal Income and $323.9 billion in Retail Sales
• Produce $284 billion in net energy cost savings
And remarkably, by creating jobs and economic growth, this investment will generate sufficient new returns to the US treasury from increased income, to pay for itself over a ten year period.
Even with inflation that is an investment of about half of what the bailout is plus it pays for itself over a decade.
How long will it take for the Wall Street bailout pay the American taxpayers back?
Financial Bailout
http://sanders.senate.gov/petitions/?petition=Financial_Crisis_1
Also note the following call from MoveOn:
---- Original Message -----
From: Adam Green, MoveOn.org Political Action
To: Nora Glenn
Sent: Monday, September 22, 2008 5:22 PM
Subject: Wall Street
Clicking here will sign your name:
"The Bush economy is in crisis, and giving Bush a blank check is not the solution. Congress must act by putting Main Street ahead of Wall Street."
Sign the petition
Dear MoveOn member,
Turn on the TV and you'll be told that we're on the brink of imminent crisis—and the only solution is for Congress to turn over vast power to the Bush administration and trust they'll use it wisely. Sound familiar?
This time, it's not to authorize war in Iraq. Bush wants taxpayers to give his administration a $700 billion check with no strings attached, which they'll then hand over to the same Wall Street firms that got us into this mess.1
It's clear something needs to be done to deal with the disastrous Bush economy, but Bush's blank check proposal is not the answer. Yesterday, Barack Obama laid out key principles for dealing with this situation. Obama's main point: Main Street must be put ahead of Wall Street, and no blank check for the Bush administration.
Members of Congress are trying to figure out what to do, and they need to hear from the public. Can you sign this message to your members of Congress today, supporting Obama's principles?
"The Bush economy is in crisis, and giving Bush a blank check is not the solution. Congress must act by putting Main Street ahead of Wall Street."
Click here to sign:
http://pol.moveon.org/wallstreet/o.pl?id=13979-5896735-tEPD6Ux&t=3
We'll deliver every signature to Congress this week—so please forward this message to some friends and ask them to speak out with you. Everyone who signs will be given the phone numbers for their Senators and Representative. Calling them will increase our impact.
President Bush wants Congress to give his Treasury Secretary (Henry Paulson, a former Wall Street executive) $700 billion with no congressional or court oversight. That amounts to $2,000 for every single American.2
Would it help families struggling to keep their homes? NO. Do taxpayers get any share of the firms we're bailing out, so we can benefit from any eventual profit? NO. Would the firms we're bailing out be required to stop paying their executives multimillion-dollar salaries? NO.3 This is a pure giveaway of epic proportions.
Even some Republicans are admitting this is crazy. Rep. Jeb Hensarling (R-Texas) asked, "Just how long can the poor beleaguered taxpayer be expected to bear all the losses and bear all the risk?"4 Rep. Steve LaTourette (R-Ohio) said, "I'm getting a lot of calls from my district, with people saying, why are you bailing out the big guys and not us?"5
Here are the principles Obama laid out over the weekend:
* No blank check. We must insist on independent accountability and oversight.
* Main Street, not just Wall Street. We need an emergency economic plan to help working families—a plan that would help folks cope with rising gas and food prices, create infrastructure jobs, etc.
* Help homeowners stay in their homes. We cannot have a plan for Wall Street banks that does not help homeowners stay in their homes and help distressed communities.
* Taxpayers should be protected. This should not be a handout to Wall Street.
* Rescue requires mutual responsibility. Institutions that benefit from taxpayer help must help protect American homeowners and the American economy. We cannot underwrite continued irresponsibility.
* Build a regulatory structure for the 21st Century. We should commit ourselves to new rules of the road for the 21st Century economy.
* A global response. The United States must lead, but we must also insist that other nations, who have a huge stake in the outcome, join us in helping to secure the financial markets.6
There are many in Congress who want to do the right thing, but they need to know the public has their back. Can you sign our petition to Congress today?
Clicking here will add your name:
http://pol.moveon.org/wallstreet/o.pl?id=13979-5896735-tEPD6Ux&t=5
Thanks for all you do.
–-Adam G., Noah, Andrea, Wes and the rest of the team