My favorite economic writer William Greider weighs in: Paulson Bailout Plan a Historic Swindle

[robertpaulsen]

Paulson Bailout Plan a Historic Swindle

By William Greider

September 19, 2008

Financial-market wise guys, who had been seized with fear, are suddenly drunk with hope. They are rallying explosively because they think they have successfully stampeded Washington into accepting the Wall Street Journal solution to the crisis: dump it all on the taxpayers. That is the meaning of the massive bailout Treasury Secretary Henry Paulson has shopped around Congress. It would relieve the major banks and investment firms of their mountainous rotten assets and make the public swallow their losses--many hundreds of billions, maybe much more. What's not to like if you are a financial titan threatened with extinction?

If Wall Street gets away with this, it will represent an historic swindle of the American public--all sugar for the villains, lasting pain and damage for the victims. My advice to Washington politicians: Stop, take a deep breath and examine what you are being told to do by so-called "responsible opinion." If this deal succeeds, I predict it will become a transforming event in American politics--exposing the deep deformities in our democracy and launching a tidal wave of righteous anger and popular rebellion. As I have been saying for several months, this crisis has the potential to bring down one or both political parties, take your choice.

Christopher Whalen of Institutional Risk Analytics, a brave conservative critic, put it plainly: "The joyous reception from Congressional Democrats to Paulson's latest massive bailout proposal smells an awful lot like yet another corporatist lovefest between Washington's one-party government and the Sell Side investment banks."

A kindred critic, Josh Rosner of Graham Fisher in New York, defined the sponsors of this stampede to action: "Let us be clear, it is not citizen groups, private investors, equity investors or institutional investors broadly who are calling for this government purchase fund. It is almost exclusively being lobbied for by precisely those institutions that believed they were 'smarter than the rest of us,' institutions who need to get those assets off their balance sheet at an inflated value lest they be at risk of large losses or worse."

more...

http://www.thenation.com/doc/20081006/greider

I hope Obama is in touch with Greider and takes his advice and suggestions into account along with his other economic advisors. I think it's high time for New Deal 2.0!

[SpiralHawk]

1. The k and the r

eom

[nadinbrzezinski]

2. Sent him a letter on this today

we need new deal... keynseian economics

Called congressional delegation as well as Madame Speaker (who's staffer proceeded to ignore it of course), what would the little vo... err serf know anyway

[robertpaulsen]

5. Bingo. Out with Friedman, in with Keynes.

Thanks for your efforts. There are a number of others on DU who have commented on how rude the people answering Pelosi's phones seem to be. I hope Obama's people are nicer and more receptive.

[nadinbrzezinski]

10. Rude doesn't start to describe it

[fascisthunter]

59. I Expect That from the Likes of Pelosi and Her Staff

it's one reason we are in this fix... too many Friedman types in our political party. Talk about being delluded, especially after what America has just witnessed.

[BearSquirrel2]

71. I am in favor of a solar probe ...

We should dig up the corpse of Friedman, burn him with valueless bond certificates, put the remains in a vessel and then shoot it into the sun.

Actually, that would cost too much. Perhaps we could sink it into the deepest trench on Earth. When are these people going to realize that the invisible hand does not work if you handcuff it and chop off it's fingers via the creation of oligopolies and the undermining of the ONLY motivation for investment ... profit.

If you have no customers, there is no investment. If the rich have all the money, there is no capitalism. There is only feudalism.

[Pete2069]

73. Bush right hand man of Bin Laden

Has Bush not done exactly what Bin Laden tried to do to our
country..
A total collapse of our democracy , economy , our
infrastructure , freedom and our military.

In just 7.5 years the republicans have destroy our country
just what our enemies have try for 100's years and failed.

Took an inside traitor to comment the job.

Looks as if Americans have finally look the real enemy in the
face and found out who they were. 

[Winterblues]

3. , it will represent an historic swindle of the American public--

Pretty much sums up the Bush* Administration...

[robertpaulsen]

6. Hopefully, Bugliosi will get to say those words at *'s trial for murder.

Vermont AG candidate says she would prosecute Bush for murder
http://rawstory.com/news/2008/Vermont_AG_candidate_says_she_would_0919.html

[glitch]

8. Bush* = all of them. Junior bested his Dad though, Babs must be beaming.

edit to add: and let us not forget the most excellent bushwork done by Jeb and George jr at Lehman. Of course Poppy will still be smiling from the AIG bailout.

Oh yes, lots of laughs going around the Bush Thanksgiving table this year.

[Tierra_y_Libertad]

4. It's a bailout for the politicians. Now, they can look like they're doing something.

In this case, it's kinda like throwing a drowning man an anchor.

[bean fidhleir]

47. Exactly. An opportunity to posture, grandstand, bloviate...and screw us again (nt)

[Greyhound]

7. K & R.

:kick: & R & :grr::nuke::grr:

[kimmerspixelated]

9. Thanks for posting this!

[closeupready]

11. You know, we've had top marginal tax rates of 90% before. Maybe

we need to re-examine that, because we simply have to pay for all of these bailouts and this debt, and the middle class can't do it.

[leftchick]

12. No he won't. He has the Economist/Traitor Robert Reich on his team

:(

[robertpaulsen]

20. In what way do you think Robert Reich is a traitor?

Are you referring to his support of NAFTA?

[leftchick]

24. no, the Glass-Steagall Act

http://www.truthout.org/article/how-much-change-does-robert-rubin-believe-in

"Foreclosure Phil" Gramm and nice guy Robert Rubin put two different faces on the power players who move so easily between Wall Street and Washington.

The personification of old-fashioned, dog-eat-dog capitalism, Gramm appears to find moral virtue in the survival of the fittest and policy guidance in Marie Antoinette's "Let them eat cake." In his long tenure as the Senate's top Republican on economic policy, he led the fight to roll back state and federal regulation of the economy, encouraging both the Enron scandal and the sub-prime lending frenzy. Gramm then left the Senate to find his reward as vice chairman of the Swiss-based UBS Investment Bank, for whom he continued to lobby Congress on housing and mortgage legislation. He also joined John McCain's presidential campaign as co-chair and senior economic adviser, until he was forced to resign last month for dismissing the chaos he did so much to create as merely "a mental recession" and the victims he left behind as "whiners."

Robert Rubin would never talk like that. The very model of a modern corporate liberal, he moved with ease from the top of Goldman Sachs to become President Bill Clinton's chief economic adviser and then secretary of the Treasury. Clinton had run as a populist on an economic platform created principally by Robert Reich, who became his labor secretary. But Rubin's Wall Street "realism" quickly trumped Reich's academic populism, and Clinton made the North American Free Trade Agreement his top priority over universal health care. He also eliminated the budget deficit left to him by the first Bush rather than rebuilding the nation's already crumbling infrastructure, and went along with the economic deregulation that Phil Gramm was pushing in the Republican-led Congress.

To Rubin's credit, eliminating the deficit helped fuel the prosperity of the Clinton years. To Rubin's shame, the Clinton free trade agreements provided no safety net for American workers whose jobs went abroad, while the newly unregulated financial markets helped create the speculative crap shoot that led directly to our current economic woes.

Dubbed by Clinton the "greatest secretary of the Treasury since Alexander Hamilton," Rubin left the administration and joined Citigroup, the nation's largest financial conglomerate, whose very existence was made legal by the deregulation measures he had convinced Clinton to accept. According to The Wall Street Journal, Citigroup has so far paid Rubin more than $100 million to serve as chairman of its executive committee, and leaves him free to serve as a key economic adviser to Barack Obama. Even more telling, Rubin's protégé, Jason Furman, now heads Obama's paid economic staff and is expected to join Obama in the White House should he win in November.

[robertpaulsen]

26. Oh, you mean Robert Rubin.

I sure hope Obama doesn't go that direction, making Rubin's protege his top economic advisor. America's workers deserve better.

[leftchick]

32. whoops! sorry about that!

yes, they are (almost) all in collusion and it sucks.

[leftchick]

50. more here from Bill Moyers and Kevin Phillips on Rubin....

http://www.pbs.org/moyers/journal/09192008/watch2.html

"Rubinomics"!

:(

[Delphinus]

82. I watched this -

hadn't realized Kevin Phillips looked like that. Pretty intelligent guy - laid it out straight, imho.

[glowing]

13. What they need to to is let the Wall-street collapse.. While that is collapsing..

Push min-wage up to a living wage, allow small businesses to take a loan directly from the treasury at a low interest rate (only for main st. businesses; not for big stupid banks). The govt needs to start immediately hiring people for public works projects.. AND we need a forceful takeover of energy.. buy them out, and the hold outs, take them over... Its the only way to really work on energy independence... Meanwhile, re-vamp the entire school system to teach children in a productive and efficient manner.. Those who excel in arts and music.. push their schooling in that direction. Others who are good in math and science, push into those avenues... Tax the wealthy so that wealth is re-distributed. If we are going to buy private business, then we should take over the big businesses that help bring in a profit. Free-market is a hoax.. it means a few become very wealthy off of bubbles and the real sweat and blood of the working force. We need to realize that certain sectors in our country do need to be socialized, while other's like the pizza joint down the street, the lawyers office on the corner, the factory that produces necessary items, and farmers who produce organic nutritious foods for the society to live on..

Simplify and spread the wealth and risk... Sink or swim together. Most families have been suffering for a long time. Jobs with pay and benefits gone, only to be replaced by a job at a box store that pay 1/2 less and without benefits. We all know how economics work. We all have to figure out how to balance our checkbooks every month. We all know that if our real wages decrease, the only choice we have is to fall back on a c.c. with interest to allow us to make it to the next month. You know, middle class people hate welfare because when they need assistance, they cannot get it. If you need some WIC or medical ins. or some food stamps, they say "too bad", they say "lose everything first, and then we'll talk". If more people were able to get assistance with financial difficulties when it arises, then they are more willing to spread the wealth or help other's when they are going through a rough patch. There are programs for the poor (and I know they aren't great, but there is help) and if your rich and deemed "too big to fail", then you get help.. But if you are one of those working stiffs who try to play by the rules and do what is right to be a productive member of society, then you are shit on time and time and time again.

People get fed up with politicians because they only work for themselves and their cronies... People are tired of being duped and shit on and lied to. I think John McCain is lying soooo much just to turn people off of politics, throw up their hands, and NOT show up. There are so many lies, who knows if the sky is even blue anymore...

[On the Road]

48. If Wall Street Had Been Allowed to Collapse

The rest of your platform is moot.

Without credit, you would not have a functional economy. No amount of redistribution would even begin to make up for the catastrophic effects of credit drying up.

[frog92969]

64. It's a lose - lose situation

The perfect ending to a malicious administration.

[On the Road]

83. It IS Lose-Lose in a Sense

but the magnitude of a continuing string of bank failures is infinitely greater than that of a bailout.

[BearSquirrel2]

76. Subisdize new lines of credit from RESPONSIBLE people ...

Who says we have to bail out these crooks? Whey don't we finance the folks who kept their noses clean? Let help THEM offer new lines of GOOD credit. Not that predatory crap they foisted on the populace.

Remember a LOT of people got screwed with bait and switch tactics. Mortgage brokers didn't want to offer clean loans as they didn't make the big commissions on them. The people who encouraged this need to PAY. If they were an executive at these companies, they deserve to have their ship blown out from under them.

At the very least, these companies need to go bankrupt. This would at least shame the executives and in many cases deprive them of their golden parachutes. It would form a foundation for shareholder lawsuits against these executives. It would caution investors not to invest in companies predating ordinary Americans. When they go bankrupt, then finance RESPONSIBLE EXECUTIVES to acquire the pieces and clean up the mess.

[On the Road]

84. That is an Interesting Concept

I have no idea if it would work.

The problem is that the repercussions are not just felt in the failing firms, but in all the firms with preferred stock or bond holding in those companies. That is the danger -- a string of additional failures that would pretty much dry up credit and send the country into a real depression. We are nowhere near that today, and it is worth a lot to stay away from that.

[rucognizant]

66. glowing..........

YOU get my write in vote!

[Solly Mack]

14. K&R

no comment..I'm still overwhelmed

[janet118]

15. Greider has been trying to tell us this since the early 90s

Re-read Who Will Tell the People: The Betrayal of American Democracy. Yeah, anyone thinking about changing Washington should reads lots of Greider so they can see how hard it will be to wrest the trough away from the pigs.

[robertpaulsen]

17. Have you read Secrets of the Temple?

It's a wonderful account of how the Volcker years at the Fed completely discredited all of Friedman's Nobel Prize winning theories. Unfortunately, most of our government has yet to take his analysis into account since then.

Thanks for the suggestion. I've been thinking about revisiting the S&L crisis years for comparison, but I think he did a great job in his article today explaining why there is no comparison: today's crisis is rigged to a derivatives market that we can't possibly raise the money to cover the losses for!

[janet118]

33. Not yet . . . it's on my must read list now.

Thanx.

[The Magistrate]

16. Mr. Grieder Is Absolutely Correct, Sir

[bbgrunt]

18. k and r! I truly wish Obama would put Greider on his team

[sicksicksick_N_tired]

19. Thanks.

I really needed a bit of validation on this crap.

[KakistocracyHater]

21. it's a BILL not a TAX

that's the difference...them tax & spend Dems....were the 90s real or imaginary?:*

[malaise]

22. Bravo Greider

I hope Dems are chilling and not jumping to heel the way they did re Iraq. This is an historic swindle.

[Octafish]

23. The rich get socialized risk and enjoy privatized gain.

The middle class get taxed to pay for their slavemasters.
The poor get nothing, but pain.

Thanks for the great article, robertpaulsen. Greider's spot on:

They are rallying explosively because they think they have successfully stampeded Washington into accepting the Wall Street Journal solution to the crisis: dump it all on the taxpayers.

As soon as I heard about the emergency bail-out, I smelled a large BFEE rat. I hope to post details later this noche. Happy days are here again, for the connected.

[robertpaulsen]

25. You nailed it. George Carlin said something similar.

You know how I describe the economic and social classes in this country? The upper class keeps all of the money, pays none of the taxes. The middle class pays all of the taxes, does all of the work. The poor are there just to scare the fuck out of the middle class. Keep them showing up at those jobs.

What is the lesson the upper classes have learned from recent history? I was reading wikipedia's entry on the S&L crisis. Here's how it ends:

Consequences

While not part of the Savings and Loan Crisis, many other banks failed. Between 1980 and 1994 more than 1,600 banks insured by the Federal Deposit Insurance Corporation (FDIC) were closed or received FDIC financial assistance. <12>

From 1986 to 1995, the number of US federally insured savings and loans in the United States declined from 3,234 to 1,645. <7> This was primarily, but not exclusively, due to unsound real estate lending.<13>

The market share of S&Ls for single family mortgage loans went from 53% in 1975 to 30% in 1990.<2> U.S. General Accounting Office estimated cost of the crisis to around USD $160.1 billion, about $124.6 billion of which was directly paid for by the U.S. government from 1986 to 1996. <1> That figure does not include thrift insurance funds used before 1986 or after 1996. It also does not include state run thrift insurance funds or state bailouts.

The concomitant slowdown in the finance industry and the real estate market may have been a contributing cause of the 1990-1991 economic recession. Between 1986 and 1991, the number of new homes constructed dropped from 1.8 to 1 million, the lowest rate since World War II. <2>

A taxpayer funded government bailout related to mortgages during the Savings and Loan crisis may have created a moral hazard and acted as encouragement to lenders to make similar higher risk loans during the 2007 subprime mortgage financial crisis.

http://en.wikipedia.org/wiki/Savings_and_Loan_crisis

2007 subprime mortgage financial crisis is a hyperlink that leads to today's events.

In other words, what the upper classes learned is that they can cheat to their hearts content and when they get in trouble, stick the workers with the bill. Greider pointed out a difference between the crises that might spell trouble for the upper classes this time:

Paulson and the Federal Reserve are trying to replay the bailout approach used in the 1980s for the savings and loan crisis, but this situation is utterly different. The failed S&Ls held real assets--property, houses, shopping centers--that could be readily resold by the Resolution Trust Corporation at bargain prices. This crisis involves ethereal financial instruments of unknowable value--not just the notorious mortgage securities but various derivative contracts and other esoteric deals that may be virtually worthless.

How do the upper classes spell trouble? R-E-V-O-L-U-T-I-O-N.

I think Thomas Jefferson would look at the situation and say we're about 200 years overdue.

[sicksicksick_N_tired]

31. I watch "Washington Journal", regularly. I CRACK UP when certain callers SWEAR SOCIALISTS,...

,...are taking over this government and will turn this country into a SOCIALIST NATION!

I wonder what the fuck is possessing their minds!!!!! SERIOUSLY!!!!

In a fascist government, the most wealthy receive private gains on risks insured by the nation, THE PEOPLE.

I do not know how much injection of reality it takes to wake up a people. I dare not try to inject any form of reality into those who actually believe this nation is "threatened" by socialism while it's being consumed by fascism. It seems a useless cause, to me.

However,...

,...I wonder what it will take to re-charge the revolution TOWARDS something SIMILAR TO DEMOCRACY.

:shrug: I wonder but I no longer angst over the will of people.

[SOS]

62. Re: "Dump it all on the taxpayers"

Conservative estimates put the bill at $7,000 per taxpayer.
Could be as high as $15,000+ per taxpayer, depending on how bad those loans really are.

Aren't you delighted to be sending 15 grand to Wall Street investment bankers?

:mad:

[Not the Only One]

74. They are appreciative

They will be thinking of you when they are drinking $800 bottles of wine on their yachts after all of this. They will be laughing their asses off when they think of you.

[WCGreen]

27. After reading The Secrets of the Temple really opened my eyes

about the banking system in this country. It changed the way I looked at everything related to money and power.

[goodgd_yall]

28. I like this paragraph from the article:

"If government acts responsibly, it will impose some other conditions on any broad rescue for the bankers. First, take due bills from any financial firms that get to hand off their spoiled assets, that is, a hard contract that repays government from any future profits once the crisis is over. Second, when the politicians get around to reforming financial regulations and dismantling the gimmicks and "too big to fail" institutions, Wall Street firms must be prohibited from exercising their usual manipulations of the political system. Call off their lobbyists, bar them from the bribery disguised as campaign contributions. Any contact or conversations between the assisted bankers and financial houses with government agencies or elected politicians must be promptly reported to the public, just as regulated industries are required to do when they call on government regulars."

[moondust]

29. The timing looks bad.

Almost 30 years of totally irresponsible Reaganomics/Bushconomics/McCainonomics capped off by a bailout on Bushco's way out the door? How convenient. A bailout plan concocted overnight? Right.

How much of this was scripted in advance?

[Laelth]

30. Good read. Thanks for posting. n/t

:dem:

-Laelth

[cyberpj]

34. kr

[truedelphi]

35. Boy, this is one time that a DU'er's posting is saving some sanity

I was just about to punch out some plaster board in the hallway, I am so mad.

This household has faced (and is facing) bankruptcy.

Not only does this nation of ours have NO HEALTH INSURANCE POLICY of any common sense - when you get battered and bruised by the policies that we do have - there is not even a tax break but a tax penalty!! (There is no exception to redeeming your retirement funds - you take it out for health insurance paymetns under COBRA so that you can have needed surgery - you face penalties plus a mandatory 10% federal tax!!)

As far as I am concerned - all these executives should be forced to work at minumum wage jobs for the rest of their miserable lives. With NO possibility of having health insurance.

Let them live in their cars if it comes to that. But whereas just this week, two top executives at the German national (or central bank) were demoted and forced out of the industry, our banking executives played these games with derivatives, wiping out the fortunes of all involved with the stock market. And they will all get their golden parachutes to cushion the fall.

And we the tax payers, the same people who cannot even get in to see a specialist who might save our lives unless we wait six or eight weeks, per the contract the HMO places over our lives - we are supposed to bail them out!!

Give me a break!! No wait - I can't afford any more medical care. Just give me a one way ticket to some country that does have National Single Payer Health Care.

[SOS]

63. We share your rage

My wife was laid off to increase the stock price of a Wall Street holding company.
Everyone over 45 was kicked out the door. "Too expensive, need to shore up investor upside".
Since then we have lost everything. Retirement, health insurance, income....everything gone.

And now the same criminals who hoover out our last money with "banking fees" are going to get bailed out with OUR tax money!!

It's insanity. And we are beyond angry.
When the sh!t really hits the fan for the average person, this is gonna be one pissed off country.

[Strelnikov_]

36. Keynesian economics on Bizarro world

Run up debt on the Federal credit card to 'purchase' assets the value of which will simply evaporate (because if they were worth something the Wall Street Boyz would not be dumping them on us rubes) in the meantime said debt does not increase aggregate demand in lieu of using said debt to build energy, transportation, communications infrastructure that will create jobs and be a true investment in the future.

When I heard the description of this travesty this morning, I knew it was the end. No money will now be available for energy transformation. We (the proles) are cooked.

Keynes argued that government policies could be used to increase aggregate demand, thus increasing economic activity and reducing high unemployment and deflation. Keynes's macroeconomic theories were a response to mass unemployment in 1920s Britain and in 1930s America.

Keynes argued that the solution to depression was to stimulate the economy ("inducement to invest") through some combination of two approaches :

* a reduction in interest rates.
* Government investment in infrastructure - the injection of income results in more spending in the general economy, which in turn stimulates more production and investment involving still more income and spending and so forth. The initial stimulation starts a cascade of events, whose total increase in economic activity is a multiple of the original investment.

[riverdeep]

37. According to the treasury secretary, we days before our economy goes into complete meltdown.

And if we don't accept the package it will happen. This sounds very suspicious. The guy who played a major role in letting this happen now knows what will happen to the markets? If he was so prescient, why didn't he do something to stop it before? President Bush wants billions in bail outs as well. This all sounds like one last final meta-looting to try and cover up the other eight years of looting.

Will the Dems fall for it? Who am I kidding, the real question is how badly will they be taken and for how much?

[BearSquirrel2]

78. **** has the cability to destroy ****

Wow, that's a big fill in the blank. First it was Saddam Hussein who was going to dirty bomb us. Now it's Wall Street that is going to destroy us. In both cases, we provide the cash.

There are still responsible financial professionals out there who sidestepped all this sub-prime bullshit. Let these institutions fail. Finance the responsible people and allow them to clean up the mess. If you're going to bail someone out, bail out the people who have been responsible.

These crepes are trying to turn Wall Street into a Slot Machine that always comes up all cherries for them due to government intervention.

[alfredo]

38. K&R

[BraneMatter]

39. Nailed it!

Just the biggest scheme ever to transfer wealth to the top via economic terrorism and extortion.

I spent the whole day calling and emailing Congressmen and Senators, for all the good it will do.

They have already indicated the bailout will be rushed through before they break in a week. Whatever was said in that room filled them with fear, and they took the bait.

[bobthedrummer]

40. K&R

[Douglas Carpenter]

41. Excellent Article!!! Highly Recommended!!! EVERYONE SHOULD READ THE ENTIRE PIECE!!

[GTurck]

42. Haven't yet read it all but...

William Greider usually says exactly what I am thinking.
If my taxes are needed to bail out these companies I want 2 things to happen. First the executives must return all of their bonuses and stock options of the past 2 years; and second either leave or be given a salary at the level of the Civil Service functionary they will be becoming. Why should they receive multi-million dollar salaries when they are in a government owned corporation?
The bonuses should be applied to the debt. x( }(

[TexasObserver]

43. Yes, it's another GOP orchestrated swindle.

The cycle repeats itself.

1. They deregulate to "get government off the backs of business."

2. They gut or refuse to enforce the regulation called for and due by them when they're in power.

3. They allow rampant disregard for those long established rules that say to limit the role of leverage in the economy.

4. Rather than require the bad businesses to pay for their bad decisions, they manufacture bailouts, to saddle the citizenry with their debacle, and hobble the US federal budget further, to limit the social programs these corporate welfare recipients most despise.

They should stop calling themselves fiscal conservatives. They're not. They're anything but fiscal conservatives. They love the national debt. They love overspending. They love socialism for corporations. They are the Corporate Socialist Party.

[lelgt60]

44. It's time for a real property/wealth tax to recover some of this money

There has to be a reasonable way to reclaim the money from people who have a ridiculous amount. I don't claim they all stole it, but it really doesn't matter.

And, it has to be an intelligent tax, because you don't want force a fire sale on illiquid assets or force people off the family farm because it happened to be near a now populated area (and thus had its land value inflated).

But there's got to be a way to get the money back

[lelgt60]

45. Why not just have the fed takeover and lend directly?

As I understand it, the problem is the banks won't lend money for normal commerce. Well, that's their job - screw em. Don't bail out anyone. Just take them over and start lending. Don't bail out anyone.

The capitalism charade is over, so why not be honest about it.

Also, that way you'd have time to figure out a proper set of rules.

[BearSquirrel2]

80. The invisible hand is real ...

The invisible hand is real. It is a set of rules that maintains a set of standards for ethical and fair competition in a marketplace.

When you have over-consolidation for either producers or consumers, this undermines the invisible hand. When you have lack of regulation that allows companies to act in a way that undermines the financial system, this chops off the invisible hand.

The role of government in a fair capital system is the same role as a referee in a basketball game. They enforce the rules so that people can play the game instead of engaging in thuggery. Ever see a "deregulated" basketball game? It's called a brawl.

[BearSquirrel2]

79. If the investors willingly gave this money to the executives ...

If the investors willingly gave all that money to the executives, they deserve to loose their investments. They're holding bad debt and they made that choice.

I don't believe all the scare tactics. If these companies go bankrupt, their stock price will go to nothing and responsible people will by the pieces of value and continue. The people who lose are the ones with the stock. I suspect most of them are Bush contributors.

Personally, I'll bet the threat is turning off all the credit cards. That would pretty much bring everything to a standstill. Well guess what. If they are banks, and they go belly up, then the federal regulators walk in and THEY can turn the cards back on. I'll take money out of the treasury for that. I won't for the assholes who caused this crisis.

[PA Democrat]

46. Send this article to people who blame the little guy swamped by a

bait-and-switch mortgage. I am so tired of the simplistic view that the whole crisis was created by people who "were greedy" and bought houses they couldn't afford.

[El Pinko]

49. K to the R

NT

[whistle]

51. Tea Pot Dome swindle to the 100th power involving the Great Global Asset swindle,

...the Great Oil swindle, the Great Inflation swindle and now the Great Bank swindle and wrapped up in one great big package and thrown at the people of the United States by the greatest muckrakers of all time and the most corrupt and incompetent administration of all time!

[FreeStateDemocrat]

52. If (big if) the American taxpayer/voter has half a brain, there should be a massive backlash in Nov.

The one thing that the elected corporate whores worry about is being re-elected and this is the powder keg that could blow them out of office.

[pberq]

53. This is Obama's chance - I hope he takes it

Obama has the opportunity right now to tell it like it is to the American public.

Does he have the courage to stand with the American people against this swindle? I hope so.

[Not the Only One]

75. Don't hold your breath

Both parties are owned by corporations and you and I know it. We just agree that the Democratic Party of today is the lesser evil.

[jwirr]

54. Pass this on to both Obama and KO. I was thinking this morning about

the irony of this situation. In 1930 the country was on the verge of becoming either socialist or communist after the crash. Along comes FDR and uses the safety net to stem this change and making long lasting enemies of people like the present day repubs because they labeled his programs socialist. They have tried to destroy those "socialist" programs ever since and especially during the raygun years with the trickle down economic theory. NOW bush has literally used the trickle down theory to destroy the US and world economy and what does he do? He makes the biggest nationalization/socialization in history to rescue the banks because he ended all those protections FDR had used to save it the first time.

Heck of a job, Conservatives/Repubs, you have done what socialists and communists together were not able to do. Yes this is fraud. The only ones to benefit from this are the ones who caused it in the first place. Country First? No, me first.

[jwirr]

61. Just wanted to add what James Howard Kuntsler is saying about

this swindle: Immediately begin renaming the GOP as the party that destroyed our country.

[kentuck]

55. K & R !

William Greider is the clearest thinker in America on this topic.

[bleever]

56. Thank you for posting this.

K&R.

[Better Believe It]

57. Just Saw This Post K&R

I posted the same article before I saw your posting of it.

Sorry for the dup.

[Better Believe It]

86. K & R

[Kurovski]

58. K&R.

Things aren't going too well, are they.

[wordpix]

60. Swindle is the word as white collar criminals and get-rich-quick schemers get bailed out while

the little guy who got in over his head loses home.

Meanwhile, Big Developers, Big Bankers, Big Insurance and Wall St. thieves can go on and on as the rich get richer. :puke:

Don't think BushCo's "men of action" aren't doing exactly what their cronies are telling them to do. They couldn't care less about you, me and Main St., as long as they get theirs.

[SOS]

65. In 1999

When Clinton/Gramm/Rubin helped set the stage for this catastrophe by repealing Glass/Steagall, they deliberately ignored regulation and safety nets.
If they had instituted a 1/4% stock transfer tax, like they have in London, we would now have $1 trillion in reserve to cover these losses.
But paying 1/4% was too much to ask of these criminals and no transfer tax was implemented. The criminals said it would hurt their "competitiveness" in the global markets.
If paying 1/4% was too much for them, then paying one dime out of my pocket is too much for me!

[JimDandy]

68. The derivatives are THE problem not stocks-all derivative transaction should have been taxed 1/4 %!

IMHO I think they should be illegal, or be allowed only at casinos. As far as I can tell they're bets, pure and simple. They don't belong on Wall Street.

[KG]

67. bring down a political party? not hardly.

the electorate just doesn't care. as long as this mess doesn't interupt 'american idol' nobody will care.

[mdmc]

69. down the hatch, I say

As I have been saying for several months, this crisis has the potential to bring down one or both political parties, take your choice.

[AikidoSoul]

70. Yep -- this is a good one

Thanks for using a Greider quote. He's one of my heroes. His "America, What Went Wrong" was a huge influence on my education about the evil that is being perpetrated on the American public.

[RUMMYisFROSTED]

72. An Historic Swindle.

Ruins everything.

[Pete2069]

77. How will you tax Bush's father and corporations

Carlyle (Bush's daddy business) Group and other corporations
have been moving offshore and overseas in order not to pay
taxes.

Looks as if they knew what they were doing and preparing for
this meltdown.

Corporations have moved all their assets overseas and said
screw this country and their citizens..

Who is stupid enough to believe that these criminals which
have been raping our country and citizens for the last 7.5
years didn't know that was happening..

Bush and our government is just feeding more of our tax money
which they are borrowing from China and our children , because
is no longer exit.

Bush has "DOUBLED" our nations debt since he
"stole" office in 2000.
And this is only from the data he lets us see,,, How much more
debt is there , in which Cheney has shredded or censored..

[pjt7]

81. what democrats

are going to fight against the bail-out on monday?

[antigop]

85. k&r. n/t

[cabbage08]

87. Kick

[bobthedrummer]

88. "I ain't gonna work on Maggie's farm no more..." kick

[robertpaulsen]

90. Thanks! Lots of Dylan lyrics running through my mind regarding this pillaging.

From It's Alright Ma:

"Pointed threats, they bluff with scorn
Suicide remarks are torn
From the fool's gold mouthpiece
The hollow horn plays wasted words
Proves to warn
That he not busy being born
Is busy dying."


From Master of War:

"Let me ask you one question
Is your money that good
Will it buy you forgiveness
Do you think that it could
I think you will find
When your death takes its toll
All the money you made
Will never buy back your soul

And I hope that you die
And your death'll come soon
I will follow your casket
In the pale afternoon
And I'll watch while you're lowered
Down to your deathbed
And I'll stand o'er your grave
'Til I'm sure that you're dead"

[screembloodymurder]

89. No deal.

Bush/Cheney must resign.