Taxpayers Shouldn't Bail Out Wall Street

With the possible collapse of this nation's (if not the world's) financial sector some within United States Government believe the Department of the Treasury should be immediately given a blank check to create even more money to give freely to faltering big businesses (include foreign companies) that made poor decisions. This blank check, however large it may ultimately be, will not solve the underlying problems and without major regulatory changes we will probably dig ourselves into an even deeper hole. We would be ultimately delaying the inevitable economic collapse that may very well make Zimbabwe an economic superpower. Wall Street isn't alone in taking the blame here, we the people must accept our share of responsibility as should a complicit Congress.

I don't support this bailout, period, most especially in its current form. I understand it may be necessary but with so many taxpayers suffering (whether directly or indirectly) as the result of this fiasco I have absolutely no confidence in any potential solution this administration or this Congress could conjure up in the short term. The good news is is that both parties are onboard in their opposition to the proposed plan from the Treasury Department and with very good reason, it is a horribly short-sighted plan and is nothing more than a blatant power grab. The terms ultimately drawn up by the Congress and approved by the President of the day (whomever that may be) must include a number of conditions that the Treasury Department didn't include in their proposal and must include significant oversight. A permanent solution to the crisis will also only come with time and a concerted effort to correct the underlying causes.

I may not be an economist but I do believe that some terms must be in any final draft of any successful proposed government bailout. First and foremost is this bailout can be in no way free. Any company requesting government money as a result of the current chaos must be forced to repay the money within a fixed period. This money should be granted only in the form of a loan (interest free or otherwise, preferably with a low interest rate paid to the Social Security Trust). The money should be returned to the taxpayer within a reasonable period of time (say 10 years). This should be the rule with any taxpayer funded bailout of any corporation regardless of whether or not this has been done in the past. This rule, of course, assumes we will not be using the Treasury Department's blueprint for their proposal. If the bailout is to come in the form of the purchase of mortgage-backed securities, as my understanding of the proposed blueprint allows me to believe, than the taxpayer must also benefit if profitability returns. We should not be asked to assume any level of risk and not be given a potion of the profit.

Other important terms include capping executive compensation, in all forms, to an amount no greater than twice that made by any government official (base pay plus bonuses of any kind plus any other perk with any monetary value or cost to the corporation). This includes the elimination or short term freezing of "golden parachutes" like the multi-million dollar one received by former HP CEO Carly Fiorina when she was forced to leave HP in 2005 after thousands were left out of work as the result of her stewardship. Automatic fraud investigations must be carried out by the FBI, or other appropriate law enforcement agency, on any corporation requesting government assistance and any company that has yet to repay taxpayers may not employ any Congressional lobbyists. Paying even one cent to any lobbyist or lobbying firm for any reason is grounds for being declared in default of the bailout agreement. And without delay the Congress must re-examine and modernize all laws and regulations governing the business sector.

This bailout must also be 100% voluntary, no more nationalization of any business to artificially prop up this economy. This is an all-or-nothing proposition that may not sit with many but is necessary, I believe, to secure a permanent economic success. If shareholders of these massive firms are willing to continue to pay their executives outrageous multi-million dollar bonuses as their companies stagnant or fail then so be it. Poorly run businesses not willing to fix their underlying problems should be allowed to fail and that failure should be placed at the feet of those running the company. Oversight must come from an independent authority answerable only to Congress with only absolutely necessary authority to include the questioning and investigation of Treasury Department and Federal Reserve Board personnel. Congress, and by extension the people they represent, must always have the final say. We the people must demand these concessions from these faltering corporations or our tax money will go to waste as we only cause greater harm to ourselves.