Many economists skeptical of bailout

[DogPoundPup]

Source: Yahoo News/Politico

Many of the same economists and opinion-makers who'd provided a bipartisan sheen of consensus to Treasury Secretary Henry Paulson's previous moves have quickly begun casting doubts on the wisdom of a policy that would allow Treasury to purchase without oversight hundreds of billions of dollars of difficult-to-price assets from financial institutions.

Under the proposal, Paulson would not have to report to Congress until December, and the only safeguard for taxpayers was a provision that the “Secretary shall take into consideration means for — (1) providing stability or preventing disruption to the financial markets or banking system; and (2) protecting the taxpayer.”

Skepticism toward the plan reflected more than the predictable desires of the left to spread the wealth to Main Street or of the right to reject government bailouts, although those sentiments were also expressed.

"We need to take a bold move. In that sense I think Paulson is right," Luigi Zingales, a Professor at the University of Chicago School of Business who wrote a widely circulated short essay titled "Why Paulson is Wrong,” told Politico.

Read more: http://news.yahoo.com/s/politico/20080921/pl_politico/13689

[pattmarty]

1. Everyone should take a look at Bernie Sanders website......

....about his "plan". All these rich ass holes benefited when things were going great guns, now they should "pay" since it went belly up. This is serious shit, 700 billion dollars for this? What about roads, education, healthcare, Iraq, Afghanistan? What a totally fucked up mess these "conservatives" have left the country in.

[Trajan]

4. Absolutely ....

It's time to end the BULLSHIT about tax cuts for the wealthy, and DEMAND they pay their share from now on ....

The conservatives had their way and removed Glass Steagall regulations from the marketplace, AND they got their HUGE tax cuts for the wealthiest citizens and large corporations ....

And THIS is where we are now ... on the precipice staring downward ....

FUCK that: It's time to PONY UP now ....

Obama's tax plan:

[rosesaylavee]

27. That is one awesome graphic.

Hadn't seen that before but it is a great visual aid.

[amandabeech]

37. Obama's going to have to come up with something different now.

We're in a new game, and he needs a new plan. And a new economics team. Bob Rubin and Laura Tyson don't have my trust any more than Furman (Rubin's disciple) and Goolsbee, favorite son of the Chicago School. He better get some economists in there who actually care what happens to the bottom 50% of the income distribution, because the folks he puts up closest to him have not met the test.

I want to hear him explain his vote on whatever abomination hits the floor of the Senate.

For me, this is Obama's achilles heel and the biggest reason why I did not support him in the primaries.

[krkaufman]

39. Of course, whatever failings Obama has on this issue, McCain is almost infinitely worse.

I, too, hope Obama is going to look out for all of us; but I have no doubt that McCain won't give two ships, and would lead us deeper into deregulation and privatization.

[amandabeech]

40. That's why I'm voting for Obama.

But if he ends up with the same ol', same ol' approach, I'll be furious with him and with my party.

[Enthusiast]

42. But McCain is given a pass

on every issue. Think of the gaffs he has been excused from. The media is already blaming Obama more than McSame.

[Pretty_in_CodePink]

45. Many of them are paying now

So many of the Republicans I know are pathologically tax averse. I bet they lost more in the stock market than they would have paid in taxes. Their republican financial philosophy is coming home to roost. Alas, I lost money in the stock market too. So they take us all down with them.

[felinetta]

7. Bernie Sanders is brilliant

[krkaufman]

16. A helpful assist would be linking to the site in question.

But thanks for the recommendation.

[pocoloco]

20. Google is your friend!!

[Towlie]

23. "Google is your friend" means pattmarty is not? Is that what you're saying? Links are always good.

[tbyg52]

29. Here you go.

http://sanders.senate.gov/

I get annoyed with "Google is your friend" as well. If a person is telling us to look at something, that means they must have looked at it, right? In that case, how hard is it to copy the link for us?

[krkaufman]

38. Precisely. Especially when "Blah Blah's site" could mean anything ...

... from personal, to official professional site, to some PAC site, etc.

[pocoloco]

32. Why not "get the rest of the story"?

Besides his web page there are several other top rated links offering additional information that might be helpful for someone not familiar with Bernie!

[rosesaylavee]

28. Is this the link?

http://www.sanders.senate.gov/news/record.cfm?id=303279

:hi:

[nichomachus]

2. If all economists were laid end to end

it would be much easier to run over them with your car.

[bleever]

3. Power grab.

Zingales fears that the Treasury bailout would effectively turn the entire financial sector into a Government Sponsored Enterprise, complete with the same murkiness and moral hazard that sunk Fannie Mae and Freddie Mac. “It might achieve the final outcome, but it will do so at an enormous cost," he said. "All the troubles we’ve seen with Fannie and Freddie would be seen again and again across the entire financial sector."

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.”

[cosmicone]

5. There has to be a tie-in to the bank's stock

For example ...

If a repuke refinanced his $1 million home at a bubble price of $3 million and cashed in the extra $2 million with the bank holding the bag, if the government only gets $1.2 million for selling the assets, then $3 million-1.2 million = $1.8 million worth of the bank's stock should belong to the government. Why should the taxpayers take a hit?

The bank has a choice --- either to get diluted by giving up stock or get a bailout -- they cannot have a bailout with no consequences.

[krkaufman]

17. Yeah. If we're going to get stuck with their bad debts...

... then we should get to take a percentage of their good debts, as well, at such a rate as to sufficiently punish them for the colossal failures but not so much that they go under. They shouldn't get a bailout and be allowed to walk away healthier than ever.

[cosmicone]

18. Exactly !! n/t

[felinetta]

6. NEVER Ever Trust A Republican

I don't like it when Paulson says: "We need this to be clean and to be quick." That statement smells so evil, I can smell it in my backyard. I don't trust ANY republican under any circumstance EVER. They are so comfortable with lying and stealing our money. Paulson doesn't give a damn for the American people. Stop lying. They want to act quickly before anyone has a chance to question their heinous plans. Remember how quickly they made us act on the Patriot Act? They are so transparent. And the nerve of Boehner (Boner) saying this is no time for games. All he has ever done is play games. Don't fall for their crap. Bush- McCain are the perfect poster children for this disgusting "party."

[Zhade]

33. "We need this to be clean and to be quick." That's what MOBSTERS say when planning their crimes.

NT!

[nichomachus]

8. Skeptical?

That's like saying "Many people are skeptical of Russian Roulette."

[Usrename]

9. It must be a horrible idea. One that will devastate this country.

I know because Chuck Schumer is making the talking head circuit and he is all for it, so it must be a bad idea.

[bread_and_roses]

14. I just emailed him, though I know it's useless

...and Clinton, and Arcuri. Guess I should hit Reed and Pelosi too....not that it will do any good.

[Bigmack]

10. "The time has come to save capitalism from

capitalists." "they say AGAIN! Somehow I thought that's what the now largely repealed New Deal legislation was all about! "We" save it, and THEY trash it....again and again. Maybe it's coming on time to take capitalism away from the capitalists and give it to the people.... I've NO confidence in the extremely dubious notion of trickle-down bailout effects. I think this current bailout proposal will trickle NO further than the big banks and Wall Street wheelers and dealers. Ms Bigmack

[HopeHoops]

11. I was thinking....

Since the "bailout" costs about $2,300 for every man, woman, and child in the US, just think what sending each of us a check for that amount would do for the economy. Yeah, like that would happen.

Be sure to write your representatives in Congress on this one - the Bush "bailout" is devoid of court oversight and ignores golden parachutes. That's just wrong on so many levels.

[Usrename]

19. What? Do you think you live in Alaska or somethin'?

Only the people that live in red states get cash from the gubment.

[bemildred]

12. Bandaids on a sucking chest wound.

We need surgery.

[prayin4rain]

13. Great article ... n/t

[Mesteryo]

15. the economists opposing this..

Are mainly free market conservatives who hate any govt. intervention in the economy. What alternative plan do opponents of this offer? Letting the market work it out doesn't seem very progressive.

[FarCenter]

21. How about a group of financial experts?

Why not appoint a group of qualified, non-partisan financial experts as a financial crisis commission to do this work? It would be better to have some collective decision making, and fairly frequent (monthly?) reporting to Congress and the President.

[lelgt60]

22. Something I don't understand about this bankruptcy...

I once had to consider personal bankruptcy. The court not only seizes all your assets, my understanding was they could go back retroactively and cancel contracts and cash payments made in the prior year.

Of course, the charter of the courts was only to protect the creditors, the secured creditors coming first.

But why isn't this just treated like a normal bankruptcy? Seize the assets, go back through a years transactions and take back ridiculous bonus/salary payments. But instead of just protecting the creditors (which themselves are banks), why not just pass a modified bankruptcy law for this occasion which gives some help for the end of the line debtors (as long as there is an opportunity to recoup any taxpayer money when the home is eventually sold for a profit).

I understand the federal government seizing the "bad mortgages", many of which are not actually bad - just not able to be valued, but I don't understand why the banks holding the mortgages are not forced into bankruptcy and dissolved, along with the stockholders equity.

[Mesteryo]

26. because they aren't declaring bankruptcy..

Meaning you are relieved of outstanding debt. The Treasury is simply buying assets of these companies on debts owed to it.

Bankruptcy isn't meant to deal with debtors but with people who owe debt.

[Piewhacket]

24. Mr. Paulson.... how to solve this problem....

convene a meeting with the president, vice president, and all the cabinet.
each secretary bring in their top execs, including top treasury and top SEC folks.
bring in the top financial wizards of wall street.
invite senior members of congress to join you
convene the meeting in the largest penthouse in the tallest building on wall street.

gather everyone.
open a window.
everyone step outside.

the rest of us will sort out the mess later.

I think it will work. I'm sure this plan will work.
Trust me, I'm Piewhacket of DU, and this WILL WORK!

[AndreaCG]

25. Fucking brilliant

[Zhade]

34. I fully endorse bush and his crew putting shotguns in their own mouths and pulling the triggers.

Seriously, those fucks need to just kill themselves.

[fascistgroovething]

30. people need to know that the Dem's understood what this was ahead of time:

http://www.senate.gov/legislative/LIS/roll_call_lists/roll_call_vote_cfm.cfm?congress=106&session=1&vote=00105

Phil Gramm's authored bill S.900... the thing that caused all this... was a PARTY LINE vote... Edwards, Kerry and Biden were all Nay... McCain was a Yea!!!!

Alphabetical by Senator Name Abraham (R-MI), Yea
Akaka (D-HI), Nay
Allard (R-CO), Yea
Ashcroft (R-MO), Yea
Baucus (D-MT), Nay
Bayh (D-IN), Nay
Bennett (R-UT), Yea
Biden (D-DE), Nay
Bingaman (D-NM), Nay
Bond (R-MO), Yea
Boxer (D-CA), Nay
Breaux (D-LA), Nay
Brownback (R-KS), Yea
Bryan (D-NV), Nay
Bunning (R-KY), Yea
Burns (R-MT), Yea
Byrd (D-WV), Nay
Campbell (R-CO), Yea
Chafee, J. (R-RI), Yea
Cleland (D-GA), Nay
Cochran (R-MS), Yea
Collins (R-ME), Yea
Conrad (D-ND), Nay
Coverdell (R-GA), Yea
Craig (R-ID), Yea
Crapo (R-ID), Yea
Daschle (D-SD), Nay
DeWine (R-OH), Yea
Dodd (D-CT), Nay
Domenici (R-NM), Yea
Dorgan (D-ND), Nay
Durbin (D-IL), Nay
Edwards (D-NC), Nay
Enzi (R-WY), Yea
Feingold (D-WI), Nay
Feinstein (D-CA), Nay
Fitzgerald (R-IL), Present
Frist (R-TN), Yea
Gorton (R-WA), Yea
Graham (D-FL), Nay
Gramm (R-TX), Yea
Grams (R-MN), Yea
Grassley (R-IA), Yea
Gregg (R-NH), Yea
Hagel (R-NE), Yea
Harkin (D-IA), Nay
Hatch (R-UT), Yea
Helms (R-NC), Yea
Hollings (D-SC), Yea
Hutchinson (R-AR), Yea
Hutchison (R-TX), Yea
Inhofe (R-OK), Not Voting
Inouye (D-HI), Nay
Jeffords (R-VT), Yea
Johnson (D-SD), Nay
Kennedy (D-MA), Nay
Kerrey (D-NE), Nay
Kerry (D-MA), Nay
Kohl (D-WI), Nay
Kyl (R-AZ), Yea
Landrieu (D-LA), Nay
Lautenberg (D-NJ), Nay
Leahy (D-VT), Nay
Levin (D-MI), Nay
Lieberman (D-CT), Nay
Lincoln (D-AR), Nay
Lott (R-MS), Yea
Lugar (R-IN), Yea
Mack (R-FL), Yea
McCain (R-AZ), Yea
McConnell (R-KY), Yea
Mikulski (D-MD), Nay
Moynihan (D-NY), Nay
Murkowski (R-AK), Yea
Murray (D-WA), Nay
Nickles (R-OK), Yea
Reed (D-RI), Nay
Reid (D-NV), Nay
Robb (D-VA), Nay
Roberts (R-KS), Yea
Rockefeller (D-WV), Nay
Roth (R-DE), Yea
Santorum (R-PA), Yea
Sarbanes (D-MD), Nay
Schumer (D-NY), Nay
Sessions (R-AL), Yea
Shelby (R-AL), Yea
Smith (R-NH), Yea
Smith (R-OR), Yea
Snowe (R-ME), Yea
Specter (R-PA), Yea
Stevens (R-AK), Yea
Thomas (R-WY), Yea
Thompson (R-TN), Yea
Thurmond (R-SC), Yea
Torricelli (D-NJ), Nay
Voinovich (R-OH), Yea
Warner (R-VA), Yea
Wellstone (D-MN), Nay
Wyden (D-OR), Nay

[eowyn_of_rohan]

31. Great find!!

this could be a new thread

[mzmolly]

36. Indeed it could. ONE Democrat voted in favor, 44 against.

Contrast that to 53 Republicans in favor and ZERO against.

[mzmolly]

35. ONE Democrat voted for this bill so what is your point exactly?

The NAYs --- 44 - ALL NAY'S = DEMOCRATS
Akaka (D-HI)
Baucus (D-MT)
Bayh (D-IN)
Biden (D-DE)
Bingaman (D-NM)
Boxer (D-CA)
Breaux (D-LA)
Bryan (D-NV)
Byrd (D-WV)
Cleland (D-GA)
Conrad (D-ND)
Daschle (D-SD)
Dodd (D-CT)
Dorgan (D-ND)
Durbin (D-IL)
Edwards (D-NC)
Feingold (D-WI)
Feinstein (D-CA)
Graham (D-FL)
Harkin (D-IA)
Inouye (D-HI)
Johnson (D-SD)
Kennedy (D-MA)
Kerrey (D-NE)
Kerry (D-MA)
Kohl (D-WI)
Landrieu (D-LA)
Lautenberg (D-NJ)
Leahy (D-VT)
Levin (D-MI)
Lieberman (D-CT)
Lincoln (D-AR)
Mikulski (D-MD)
Moynihan (D-NY)
Murray (D-WA)
Reed (D-RI)
Reid (D-NV)
Robb (D-VA)
Rockefeller (D-WV)
Sarbanes (D-MD)
Schumer (D-NY)
Torricelli (D-NJ)
Wellstone (D-MN)
Wyden (D-OR)

[blm]

44. The point is that it was a nearly exclusive GOP bill not a Dem bill.

.

[mzmolly]

46. Wasn't sure how to read what was posted

given the OP has been banned?

[blm]

47. That seems odd when the info in the post sided WITH Dems 100%.

.

[mzmolly]

49. Depends upon how you read the statement. "Dems should have known..."

I took it to mean that perhaps Dems should have known something before we got to this point? But of course the banning becomes even more mysterious given that may not be the case, doesn't it?

[blm]

50. I read it as Dems UNDERSTOOD what would happen with that bill and voted against it.

.

[mzmolly]

51. I think you read it correctly and I did not?

However, I assume I'm not the only person who was confused given the status of the OP at the time of my reply?

[blm]

52. yeah....I'd guess maybe the mod read it differently, too. It was clumsy but not RW, and

I sympathize with the poster as I've posted many awkwardly worded posts meself. ;)

[mzmolly]

53. As have I!

I too sympathize. BTW, I've also read clearly worded posts wrong LOL.

[blm]

43. Did the President at the time sign this bill?

.

[bbgrunt]

48. k & r.

[depakid]

41. So now politco is a credible site to put up?

Even on non-tabloid like matters?