Sirota: The Fiscally Insane Bailout Bill Might Not Pass

[Phred42]

The Fiscally Insane Bailout Bill Might Not Pass -- Here's 5 Reasons It Shouldn't
http://www.alternet.org/story/100700/
By David Sirota,

The scheme would force taxpayers to absorb the pain, while Wall Street execs reap the gain.
There was news Sunday afternoon of a congressional deal to bailout Wall Street fat cats with $700 billion of taxpayer cash (you can read the draft legislation here). Though the deal negotiated between congressional leaders and the White House is better than what Treasury Secretary Henry Paulson originally proposed early last week, it remains an insulting atrocity, having omitted even basic aid to homeowners, bankruptcy reforms and any modicum of future financial industry regulation. Now, the New York Times reports that the Democratic leadership may not have the votes to pass this bailout. So without further ado, here are the top 5 reasons (in no order) why every single member of Congress -- Democrat and Republican -- should vote this sucker down. Please feel free to copy and paste this post into an email to your congressperson. They are deciding right now -- let them hear your voice.

(note: the argument for each of these points can be found at the link)

1.This Bailout's Inherent Fiscal Insanity Could Make Problem Worse

2. Experts on both the left and right say this bailout could make things worse

3. There are clearly better and safer alternatives

4. Any Incumbent Voting for This Puts Themselves At Risk of Being Thrown Out of Office

5. Corruption and Sleaze Are Swirling Around These Bailouts -- and America Knows It

[dkofos]

1. It didn't work in 29 and it won't work now!!

[Phred42]

2. Correct. And it didn't work for Japan and others either

In fact IT HAS NEVER WORKED!

Damn the torpedoes - full speed ahead

:banghead:

[muriel_volestrangler]

3. The policy in 1929 was "no bailouts - let the market sort itself out"

Contemplating the wreck of his country's economy and his own political career, Herbert Hoover wrote bitterly in retrospect about those in his administration who had advised inaction during the downslide:

The 'leave-it-alone liquidationists' headed by Secretary of the Treasury Mellon felt that government must keep its hands off and let the slump liquidate itself. Mr. Mellon had only one formula: 'Liquidate labor, liquidate stocks, liquidate the farmers, liquidate real estate'.He held that even panic was not altogether a bad thing. He said: 'It will purge the rottenness out of the system. High costs of living and high living will come down. People will work harder, live a more moral life. Values will be adjusted, and enterprising people will pick up the wrecks from less competent people'

But Hoover had been one of the most enthusiastic proponents of "liquidationism" during the Great Depression. And the unwillingness to use policy to prop up the economy during the slide into the Depression was backed by a large chorus, and approved by the most eminent economists.

For example, from Harvard Joseph Schumpeter argued that there was a "presumption against remedial measures which work through money and credit. Policies of this class are particularly apt to produce additional trouble for the future." From Schumpeter's perspective, "depressions are not simply evils, which we might attempt to suppress, butforms of something which has to be done, namely, adjustment to change." This socially productive function of depressions creates "the chief difficulty" faced by economic policy makers. For "most of what would be effective in remedying a depression would be equally effective in preventing this adjustment."

http://econ161.berkeley.edu/TCEH/Slouch_Crash14.html

[groovedaddy]

5. There's no question that "something" should be done - but what? Essentially what is

happening now is that wall street, the bush administration (both proven untrustworthy) after saying everything was fine, are now screaming for action like their hair's on fire. Do you trust these people?
Leadership in congress understands that something must be done but have done a piss poor job of selling it to the American people.
There are too many experts who agree that something must be done, BUT NOT THIS!

[pnutbutr]

6. these experts

have some insight as to what should be done and why or are they just screaming about impending doom as well?

[groovedaddy]

9. There is not general agreement among experts on what needs to be done.

There are many who believe this action will fail.
Paulson says this plan was in the works for months...Nancy says it snuck up on her.
Something is rotten in Denmark!

[pnutbutr]

11. so it's

just screaming then?

Paulson and Pelosi :eyes: I'm not inclined to believe either one of their statements on this.

[muriel_volestrangler]

13. Agreed - I just wanted to make it clear that the Great Depression wasn't the result of a bailout (nt

[Javaman]

4. well, it just passed the house, let's see what the senate does. nt

[avaistheone1]

7. I heard it is supposed to be easier to get this bill through the House.

[paparush]

8. I've called all my Reps again this morning...telling them flat out, that if they

support the E.E.S.A. of 2008 that I will not vote for them and will actively campaign against them.

[NashVegas]

10. 6. Sometimes, Average American Citizens Get It Right

Contrary to those who try to shove this crap down our throats.

[MGKrebs]

12. I think they are really just buying time.

It's something that can be done now to build confidence and hopefully prevent a run on the banks, and then they can tackle the complex comprehensive solution when we're not in "the heat of the moment".