Here's an edited copy of the letter I faxed to my senators and congressman.
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The Honorable
Washington, D.C. 20510
RE: Bush-Paulson $700,000,000,000 Bailout Plan
Dear Senator:
I am writing to express my utter dissatisfaction with the proposed bailout plan being peddled by President Bush and Secretary Paulson. That plan does nothing, absolutely nothing to prevent this situation from happening again. Instead it gives a blank check to prop up firms that engaged in speculation and risky securities. That plan provides absolutely no accountability for the expense of our tax dollars, nor requires any results for the spending of our tax dollars, nor does it give any guarantees that spending our tax dollars will fix this situation. The Bush-Paulson plan is nothing less than the wholesale robbery of American taxpayers and is completely morally bankrupt. This is nothing short of Wall Street Welfare.
There are alternative plans being floated that make more sense and actually will fix the situation instead of robbing the American taxpayers and the next two generations blind and pushing America into a cauldron of violence.
First: The plan must not be a bailout. It must seek to correct the lack of regulations and oversight that led to this mess. The lessons of the Great Depression were that 'anything goes' only works to enrich the few at the expense of the entire country. All securities must be regulated. Credit default swaps should be outlawed, with a phaseout period of one year. Any other similar Ponzi financing schemes must also be outlawed. All approved financial instruments must be backed at minimum ratio of twice as high as that required for federal chartered banks due to the increased risk involved.
Second: The plan must provide accountability for results. Lack of meeting restructuring goals will mean the board and executives are fired and the compensation they receive returned - which can be accomplished via tax liens and property seizures (including immediate family or any other persons to whom compensation was transferred to). Any foreclosed homes sold at auctions must not be sold to modern day robber barons, financial gangs or any entity associated with any failed bank or their executives (current and former). The goal must be to put families back into these homes as owners, not as serf renters. Absolutely no auctions will be valid unless a minimum quorum of bids is received from completely unrelated and non-conspiring parties. For homes not able to be auctioned off, they will be rented by a HUD or the equivalent state agency, with a rent-to-own plan. States can set income qualification ratios for down payment equivalences, such that those with the least amount of any/all income would receive the most favorable rent applied to ownership ratio. The goal is to get Americans back to owning their own homes, as that is the foundation of our economy.
Third: The plan absolutely must not reward the executives that ran the participating companies: All compensation contracts must be terminated for the executives of these companies - no golden parachutes, no perks, no 10010+:1 compensation disparities. Any such compensation already received by these executives in excess of $1 million dollars must be returned to the participating company.
Fourth: The plan must include equity stakes in any participating company so that the taxpayer has a voice on the boards of these companies and can recover capital invested. The gross profits will be used to calculate payments back to the American taxpayer. This would be to lessen the effect of accounting chicanery that such companies would try to foist on taxpayers in an attempt to plead poverty and inability to pay back the American taxpayer. Gross profits would be computed without deductions for any fees nor other gimmicky transactions. Payments back to the American taxpayer would be a percentage of gross profits on a sliding scale dependent on the amount of the equity owned by the American taxpayer.
Fifth: The plan must include restructuring of portfolios of the companies involved, to rescue American homeowners facing foreclosure and any loans that with balloon payments due in the next five years. It makes more sense to keep people in their homes, with funds coming in rather than have whole communities empty. When houses are deserted, and abandoned they are gutted and become havens for criminal activity. That is vicious cycle as the value of the entire neighborhood drops and more law abiding citizens flee or are forced to survive in such neighborhoods. It doesn't take much common sense to realize that such neighborhoods will breed domestic militancy worse than what we have seen overseas. It is for this reason that it is vital that Americans be kept in these homes, to prevent the decay of our towns and cities into areas racked by domestic terrorism, gangs and other violence. Recall that in good times, violent crimes go down.
Sixth: The plan must be subject to congressional oversight and the personnel at the government agency in charge must not have judicial immunity from any decisions they make. This must not be handled by a branch of the executive department with carte Blanche to cut back room deals with their friends nor business interests. Any personnel working at this agency must be fully divested of all assets tied to any of the companies being managed and/or any entities buying liquidated properties. This requirement for zero conflict of interest must also extend to the agency employee heirs and family members (to include business interests of family members). Any deals found to be lacking in documentation, appropriate targets, appropriate payback plans, or prepared/negotiated by those with conflicts of interest will be invalidated by a simple majority of the House Finance committee.
That is just part of what is required in a realistic plan to fix this mess will require. I hope I have your support in promoting and passing such a plan. There is more at stake here than billions of dollars.
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It't not perfect, but it supports the sane provisions of the plans I have heard being floated with some extra protections thrown in.
Remember this battle cry when you vote this November.
Just say NO to Wall Street Welfare,
Say NO to greedy MBA types in fake reformers clothing
Say NO to more of the same, McPain!
