Bailout Round II: A New Shade of Lipstick

[davidswanson]

The House of Representatives voted down Paulson's Plunder on Monday, 225 to 208. Here's why: http://afterdowningstreet.org/node/36420

We demanded a No vote and for the first time in recent memory we were listened to. Thank you! Three cheers for the American people!

Now is not the time, however, to rest on our laurels. Speaker Pelosi is almost certain to dig deep in her purse for a different shade of lipstick she can smear on this pig in preparation for a re-vote, and it might be a deep Republican red. There were certainly some Republicans who voted No on Round One because the bill wasn't even worse than it was, because it didn't add further deregulation and/or tax cuts for the wealthy to the current catastrophe. Needless to say, Pelosi's first inclination will be to go after those members' votes.

On the other hand, Pelosi could go with a purplish gray and tack some more populist smelling features onto the first bill in hopes of puckering up this pig for some Democrats. Her main tactic if she takes this approach might be unrelated bribes and threats, combined with a hope that certain Democrats will feel comfortable telling their constituents that they voted No on Round One and must therefore be forgiven for voting Yes on Round Two. Don't think these people won't kiss this pig and use exactly that line. Therefore, those of us who want to prevent Paulson's Plunder had better keep our phones on redial until we get through to Congress at [phone] again and again and again.

What's our message now? It's a tentative Thank You to those who voted No combined with a demand that they not cave in, and a promise to work to unseat those who voted Yes unless they redeem themselves immediately. And how can they do that, and what do we want from Congress now? I'll tell you what I want:

I want a bill immediately to ban predatory mortgage lending, ban states from preventing cities from restricting predatory lending, and commit the federal government to allowing states full freedom to restrict predatory lending.

I want a bill establishing a maximum wage at 10 times the minimum wage, and including all forms of income in that calculation (and raising the minimum wage how ever much required to pass the bill). I want the tax system created by that bill to pay for any necessary bailouts, and want such bailouts enacted and overseen by Congress.

I also want a Tobin tax on all transactions in finance, insurance, and real estate, including currency transactions.

I want Congress to haul fraudulent bankers into Washington and force them to testify, fire them without compensation as part of any bailouts, and refer them to the Justice Department for prosecution.

I want serious regulation of Wall Street.

I want a five-year moratorium on foreclosures, and a bailout of homeowners equal to any bailout of bankers.

And, finally, I want $700 billion invested in green energy jobs immediately, to be paid for by a tax on carbon emissions.

In fact, I would like to see all of these steps included in a single bill called the "Honest Emergency Economic Stabilization Act of 2008." Somebody explain to me why that wouldn't be a good move for our economy and a smart political step for those who propose it.

[MarjorieG]

1. We need a short term solution to keep credit and payrolls open, with the rest deferred until January

I trust Obama to see the big picture of government's need to regulate, take care of Main Street, but we do work in partnership with Wall Street every time you make a credit card purchase. Globally, it's unavoidable.

You're a good opposition force, but often a little purist and narrow focus.

[davidswanson]

2. This country was created

so that you wouldn't have to trust a single royal ruler, much less one working in partnership with an unelected kleptocracy

you CAN trust him - there's no requirement that you distruct him, it's just proven a bad strategy for citizens of every nation in every century since about the time Palin thinks dinos lived

[whistle]

11. Short term answer which may also help toward a long term solution

...is to set a surtax on all stock transactions of .65% of each trade that would be submitted to the U.S. Treasury for bailout help of the most needed as justified by the general welfare of the country on preserving liquidity and ultimately recouping the $350 billions in bailouts so far. When the credit situation has been stabilized and other aspects of abuses brought under control the surtax could be reviewed for elimination or application to the lost Bush revenues through tax breaks to the wealthiest over the past eight years to liquidate the Federal Debt and the interest on that debt.

Make Wall Street work for Main Street for a change.

[SnowCritter]

3. I agree to your "wants" with a suggestion

As it related to predatory lending: Cap the interest rate at some reasonable rate (perhaps 18-21%). Get rid of "universal default" (If a borrower defaults at one credit institution he is considered to have defaulted at all the credit institutions he deals with).

[davidswanson]

4. agree

i agree

[tama]

5. Please

be open to the possibility, that now that the people have spoken (and their representatives spoken for the people), this is actually the sign of revolution, liberty from the oppression of party etc. elites.

[davidswanson]

6. it IS that

if we build on it and make it have been that

[tama]

13. This could actually unite

American people - and "we the people" regardless of partisanship. FOR something better instead fragmentary divisions of "conquer by dividint", instead of group thinking of cultural wars of who gets to dictate how other peoples live.

[RhodaGrits]

7. I was with you until you went to the 10 X the minimum wage stuff -

I am the primary generator of income of my own business and if I support a staff of 16 with my income as a professional, I damned well want to be able to pay myself more than 10X what the 14 yr old high school kid working after school makes - you can tax it fairly but I should be able to pay myself what I earn.

It makes a lot more sense to me to tax the highest income earners heavily than to cap it too low. I have seen 20X as a more reasonable ceiling. Or key it to production. Whatever.

Or are you proposing this for publicly traded companies only?

[Naturyl]

9. OK, I'll settle for a 75% or higher top tax bracket.

Dunno about the OP, but I'll settle for that instead of a maximum wage. Deal?

Didn't think so.:)

[RhodaGrits]

10. Actually, I don't disagree with a 75% tax cap at the top IF...

You include what I'm paying in federal and state income tax AND property and school taxes. I should not have to pay more than 75% total in taxes and RIGHT NOW I AM. And I have no kids so little benefits back and lots of paying in.

[davidswanson]

12. for everyone

i recommend Sam Pizzigati's books on it

[BrklynLiberal]

8. K&R for further perusal

[Dr.Phool]

14. Keep the pressure on.

All kinds of fear-mongering and outright bullshit being spouted on CNBC.

Pelosi plans on reconvening the house for another vote on Thursday.

Remember, this was so unpopular, that these guys had a deal so that the bare minimum on both sides would vote for it, and they could all go back to their districts and blame the other side.

Keep the pressure on. We want hearings, and a bill that is fair to everybody, makes America stronger, and builds for our future. They're already spinning the next vote as a "rescue package", not a bailout. A shit sandwich is still a shit sandwich, whether it's on wheat or rye.

Keep the pressure on.

[Jim Lane]

15. A five-year foreclosure moratorium makes no sense

If everyone with a mortgage can stop making payments, and suffer no consequences for five years, then a lot of them will stop making payments. Mortgages that were worth substantially less than their face value, but still worth something, would suddenly become virtually worthless. Would you have the government compensate the lenders for this huge hit on the value of their assets? How much would that cost?

The hard fact is that some people are in housing they really can't afford. (Either their fortunes have taken a turn for the worse, or they never belonged in that housing in the first place, and wouldn't have moved there if the market were rational.) I don't see it as government's job to guarantee to people that they'll never have to trade down in terms of housing.

There are people who are homeless. There are people who are living in overcrowded conditions in small apartments that aren't well maintained. I have a lot of sympathy for those people. For a childless middle-class couple who are currently living in a much larger house, but who might have to downgrade to one that doesn't have a swimming pool, I have much less sympathy.