bailout terms

September 23, 2008

Listening to NPR this morning I was amused to hear that various republicans were outraged that house and senate democrats wanted to put paycaps on executive salaries of the companies that the government would be bailing out of this whole fiasco. I was more amused to then here that the various republicans were in positions to benefit from their NOT being paycaps. It’s sad when the party that wrecked america (the republicans in case it wasn’t clear) can be so blantantly and bald-faced greedy.

I support the democrats who wish to put more controls on the industry and to allow bankruptcy judges to rewrite the terms of bad loans. However, I’d like to add an addendum to the paycap rules. It would go something like this: If you’re an executive of a company being bailed out then you have failed to do your job. Therefore, your options are limited. You may: 1. resign w/no severance and no golden parachute – you simply get to walk away. If you choose this option you are restricted from working in any field related to finance for the next 10 years. 2. You may choose to stay on, but you are now working for the US Gov’t and you will be paid commensurate with a private in the us. army. You are drafted into service of the gov’t and you are not allowed to leave until your term of service (4 years) is up.

In short, I’d just like to say that I understand the need to shore up this industry with tax payer money but I will be goddamned if I’m going to tolerate someone bringing in a 2 million dollar salary from tax money b/c they did a crappy job.


8 Responses to “bailout terms”

  1. Thruhike98 Says:

    Good point. I have a huge problem with the free-market folks socializing their mistakes. “Heads I win, tails you loose.” And that this is the fix we must implement in a hurry, courtesy of the folks who failed to recognize things were slipping.

    Another little facet of this is the get-out-of-jail-free card written in to the legislation. This is very similar to the one that was slipped in to the Patriot Act that protects the Pres. and VP from any investigations. From Section 8:
    “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.”

    So, give him $700 billion dollars (and that’s just the limit to the liability at any one time – he can sell off assets and then purchase more, just never exceeding $700 b.) with _no_ oversight from the other branches of government on how it’s used.

    Today will be the first time I call my Congressman.

    This is the new M.O.: First (create) a trauma – be it w.m.d. or the end of finance as we know it, then run an extreme power grab though the Congress that no one would otherwise agree to if it weren’t an emergency. Then,

    Tada! New paradigm.

    Naomi Klein, author of “The Shock Doctrine,” has a good perspective on this.

  2. bhavekost Says:

    Agreed on the bailed out companies not giving bonuses while in bankruptcy, but riddle me this: If the repuglicans are truly to blame for this whole financial institution meltdown, why doesn’t the Democrat controlled congress investigate, hold accountable and punish those involved? They do control congress don’t they…..

  3. skvidal Says:

    I wouldn’t want hearings to find people to blame.
    1. it won’t do any good
    2. it will keep us from actually doing anything for the next N years and that’s just not a good bargain.

    Now, if you want to have hearings about finding out who is responsible for us going to the war in iraq – that’s another story.

  4. Stephen Smoogen Says:

    The Democrats control the House, but do not control the Senate.. In the Senate you need 60 seats to be considered in control of it. Not sure if the Republicans or Democrats have been in control of the Senate in the last 10 years at all :).

    So basically its both frickin’ parties faults… and its the fault of every frickin’ American who didn’t hold their country’s elected leaders to a higher standard. And since everyone is to blame.. no-one is and we watch the late Roman empire all over again

    Of course party affiliation mean zip in the US versus other countries. A Democrat may vote mostly with Republicans and a Republican may vote mostly with Democrats (though that is less often). There is no ultra powerful whip status like in the parliament systems i have read about.

  5. Why is it my responsibility (as a taxpayer) to “bail-out” someones failed business in the first place.

    As a taxpayer …

    — I have paid to help rebuild coastal cities in hurricane-prone areas.
    — I have paid to help someone stay in a house they cannot afford.

    And, we know there are many others. How does this help “me”? I supposedly pay taxes because the services provided by the government are supposed to help me in some way.

    — Rebuilding a city where I do not live does not help me.
    — Paying someone else to stay in a house they cannot afford does not help me.
    — Bailing-out someone’s failed business does not help me.

    Yes, I know. Bailing these guys out will help prevent the financial “meltdown” that could ensue. But, I hate paying for someone else’s mistakes!

  6. When we did this in Sweden a number of years back, the state got shares in the banks in return for bailing them out. It seems the state actually has gotten the money back now, so it wasn’t that bad a deal.

    I think one of the proposals from the Democrats is inspired by that.

    Both banks and homeowners really should be more careful, though.

  7. krevmorla Says:

    In fact, the Dems are way over 50% responsible for causing this debacle. Seeing that low incomers could buy homes with no equity was their “baby”. Fannie Mae was their “baby”. Receiving big kickbacks from Fannie Mae was their “baby”. And who was at the top of that fateful list?… right, Sen Dodd and B. Hussein Obama. Let’s not even mention the graft and corruption of Franklin Raines. The list just goes on and on. Dems got what they wanted, now we all have to pay for it.

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