Economic Outlook: Stop Congress from Giving Away Your Money

By Richard Hylton
Thursday September 25, 2008 - 09:51:00 AM

In the latest example of privatizing profit and nationalizing risk, the Bush administration has proposed bailing out Wall Street’s investment houses, hedge funds, and all the commercial banks by giving away $700 billion of taxpayers’ money. The total cost of the ad hoc bailout of financiers may eventually exceed $1 trillion. And the administration’s Treasury secretary, Hank Paulson, says we must give him the power to use this $700 billion any way he sees fit. And, by the way, Congress has to give it to him right now! 

Well, the billions have added up and now we are talking about real money. Why is it that when these Wall Street guys go into government, they want to do things with public money that they would never consider doing with their own money or even the money of their clients? No oversight, no consequences, and no help for the struggling families on the other end of this Wall Street-made crisis. That’s the Bush plan. 

Call your representatives in the Senate and the House and tell them hell no. Not on those terms. If the people are going to foot the bill for rescuing the banking sector, then we need to get some things in return: 

(1) An immediate cap on executive pay for any company that wants to unload its garbage investments on the public. And we don’t mean a $1 million cap. Think penance, folks. 

(2) An equity stake for the Treasury in any company that wants government bailout money. Why should the taxpayer get stuck with the junk investments and free overpaid bankers to go ahead and make more money for years to come? Some of that future profit should belong to the people. That’s the kind of deal Warren Buffett just got when he agreed to invest $5 billion in Goldman Sachs. Why should the taxpayer get nothing but hope that the crisis will end?  

(3) Relief for the hundreds of thousands of American families who are facing foreclosure and the loss of their homes. Whose money are we giving away, again? What have the regular folks at the other end of the financial markets crisis gotten in terms of help from the government? Bupkis! Use the resources of the Treasury to help struggling American families. 

(4) Enhanced unemployment benefits for those who have lost their jobs. 

(5) Major investments in America’s infrastructure to generate new jobs and stimulate our economy. 

(6) And, finally, bipartisan oversight and limits on how the Wall Street guys who usually run the Treasury are allowed to spend that $700 billion. 

Take the time to call your Congressperson and any members of the House Financial Services committee and the Senate Banking, Housing and Urban Affairs committee. Demand that they demand these provisions in any bailout package. This may be one of the most important phone calls you will make this decade. Really. 


Speaker of the House Nancy Pelosi (202) 225-0100; Rep. Barney Frank (202) 225-5931; Senator Christopher Dodd (202) 224-2823 ; Rep. Maxine Waters (202) 225-2201 ; Rep. Brad Sherman (202) 225-5911; Rep. Joe Baca (202) 225-8671; Rep. Jackie Speier (202) 225-3531; Rep. Gary G. Miller (202) 225-3201; and Rep. Edward R. Royce (202) 225-4111.