I'm writing this article a full week before it's due to appear in the paper. Considering all that's going on in the election, I know that's early, but unless someone drops out of the race, I doubt that anything in the election will match, for pure audacity alone, the blatant extortion that George Bush is trying to perpetrate on the people in his so-called bailout plan. His plan has the potential to be the biggest ripoff of the people in the history of this, or any other nation, since man first set foot on Earth--and I mean that quite literally.
Initially I thought their game could be revealed by simply determining if they were telling the truth about the seriousness of the problem, but between the banking community's multiple schemes to rid us of our funds, and Bush's plan to bail them out, the money trail is so convoluted that it's hard to get a handle on whether or not they're telling us the truth. But there's one thing that I did get a a handle on, the fact that the Bush administration wants sole control over the bailout--and that alone was enough to send a flaming red quilt all the way up my flagpole.
It seems that George Bush-the very same man who has mismanaged everything he's touch for the past seven and a half years, and who has gouged, corrupted, and claimed to have literally "lost" billions of dollars of taxpayer funds in Iraq-is now asking that we give him full control over the way they spend 700 billion dollars to resolve this financial crisis-and then, he warns us that even taking the time to think about it is dangerously imprudent.
Section Eight of the Bush bailout plan reads as follows:
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
The arrogance of the Bush administration is so absolutely astounding that the only thing that could possibly explain it is if they think the American people are completely stupid--which is quite possible, considering what we've allowed them to get away with in the past--or the administration itself is completely out of touch with reality. Do they really expect us to give a lame-duck president with an approval rating of 19, with three months left in office, a record of never seeing a crony he didn't want to enrich, and only stumbling inadvertently over the truth in the past two terms, 700 billions dollars-and with the stipulation that his discretion is non-reviewable by any agency or court of law? Could they possibly be serious?
Could this be the October surprise? Could it be that the Bush administration sees the writing on the wall, and recognize that their time at the troff is over, so they want to make one last super big score before leaving office?
Consider the fact that with the stipulation that the secretary's authority is "non-reviewable", Paulson has the right to hire and fire. That would allow Bush to his put cronies in place throughout the banking community, and thereby, effectively control our entire financial system. In fact, they might have already started playing politics with the system. If they already knew that a possible bailout was in the works, why did they allow Lehman Brothers to go under? Could that have been political? That needs to be investigated.
And while I'm not an attorney, I would also be concerned that Bush could establish an independent agency, and fill it with his cronies, that would be beyond the reach of the next administration--and with the current Supreme Court, he just might prevail with such an arrangement.
So needless to say, section eight of the bailout proposal should be dismissed out of hand. And congress should insist on the American people owning equity, and receiving annual dividends from the gross profits of any structured group that participates in whatever bailout plan that is agreed upon. If the situation is as dire as they say, the banks should be eager to except such an agreement. If they're not, we'll then know that they're crying wolf.
The only way the American people can be sure that we're not being manipulated, and won't be manipulated in the future, is to set a precedent assuring that the financial community pays a stiff price for the assistance that they're requesting.
Therefore, I suggest that the various corporations participating in the bailout should be consolidated into one group. The corporations within the group itself would be responsible for determining, and substantiating, the amount of bailout money the group would require to remain viable. The government will then gain a 50% inactive share of each company participating in the bailout as collateral, to be returned to the company once the public debt has been paid, and every company participating in the bailout will be held individually responsible for the group debt as a whole.
The government would then negotiate an open-ended loan at the prevailing rate, but a rate that would escalate at assigned periods, based on the percentage of the debt remaining at that point. The group would then pay off the debt by setting up a trust fund in which the group must contribute a percentage of their annual gross profits, with the group itself determining a formula for which the various companies would contribute to the fund, based on what percentage of the bailout fund each company required to remain solvent.
The government would then establish a formula to determine what percentage of the groups annual gross profits would go into this trust fund. The formula would take the following indices into account in the taxpayer's favor: The prevailing minimum wage, the cost of living, and the level of disparity between the average salary of a middle class worker and the compensation of top tier corporate executives.
Of course, the banking community is going to say that this plan is unacceptable, but the plan should be non-negotiable. The conservatives have shoved their fiscal philosophy down our throats for years, so now the Democrats should simply say, "Here's what we can do for you--take it or leave it. And beyond that, were tacking on to any bill we sign a 20 year mandatory prison sentence for anyone convicted of profiteering from the bailout agreement."
If things are as bad as they say, they'll accept the plan to survive. If they think they can survive without it, we can pocket our money and move on to other issues.
Congress should advise Bush that his bailout plan is a give-a-way to the banking community, thus, socialist in nature, and we can't have that--can we?
Eric L. Wattree