Political Discussions
Bankruptcy, Not Bailout is the Answer
Posted by globalgirl • 9/30/08 • Subscribe to this Discussion [RSS] • Report This Topic
Topics: bailout, bankruptcy, corporations, economic crisis
Thought I'd pass along this recent commentary:
Bankruptcy, not bailout, is the right answer
www.cnn.com/2008/POLITICS/09/29/miron.bailout/index.html?iref=mpstoryview
What do you think?
User Comments
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Yes I agree we should let them fail and go bankrupt!!! As I said in a similar post on my blog randompoliticalthoughtsandnews.blogspot.com/2008/09/another-bank-going-unde... -
It's easy for a libertarian with a tenured position at Harvard to say that the country needs to go through this pain. He's not threatened with job loss, and he's not running a business that will collapse due to lack of credit.
One could argue that the Great Depression had some positive side effects, but that doesn't mean it's something one wants to see happen.-
Wrong placement
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There was an informative post on another thread (main board) that explained more about the securities involved in the Wall Street problem.
Here's the link:
www.blogcatalog.com/discuss/entry/wall-street-or-main-street
In particular, the comments by Dougist are interesting to me. He took the time to respond to some questions in detail last night in an informative way.
The problem, as I see it, is that if we allow the investment banks to go bankrupt, then corporations and small businesses who rely on credit to make their payroll will default, and workers on a wide scale may not get paid. How many American households would suffer if that were allowed to happen? Granted, the length of time that has passed since the crisis first emerged has given some businesses enough time to maneuver their assets somewhat, but what would happen to you if we just said "screw them" and let these large investment firms and banks collapse?
In my view, that would be a mistake. There has to be a way to craft smart legislation that helps keep credit markets moving, even if the economy at large has a major slowdown. I believe that the package should have a mixture of aid to local areas, homeowners, states, and corporate America. Just what that balance should be (to steal a turn of phrase) is 'beyond my pay grade'... but I don't believe it will serve the country or the world well to let the economy founder.-
Thanks for the link and perspective. I don't think that bailout is the answer. Congress is being asked to push through an enormous debt burden quickly, (reminds me of how the Patriot Act happened so swiftly, in the name of security) but there needs to be more time to make decisions that are in the best interest of all of us taxpayers, not merely corporations and leaders that be.
I do not trust Paulson, nor many of those in political leadership, to make the "best" decision. Look where this has brought us? (This is one of the main reasons I am an independent).
When you have the likes of the former CEO from WAMU (who was only in his position for 17 days!!), walking away with a whopping $19 million dollars before the bank was seized by the govt and then sold to JPChase, we clearly have regulation problems.
We, most of us, are being fleeced by the govt and corporations, while they laugh all the way to bank. Do you really not think they saw this coming?
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Why did this comment get removed?
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Apparently a link prefaced by an explanation that includes the word "prayer" is found offensive by some.
Again, in this time of economic distress, my post deals with the way some people might consider seeking solace.
I'm going to post this again, with the hope that the comment removal was just a mistake.
Again, while some people's agenda might be to post and talk about any number of topics, my interest is to participate in BC and contribute what I feel might be important faith-based information...although not always.
I was told by BC admins that faith is a welcome topic here.
And yes, this relates to the bailout! It's my story of how I have come to grips with it and hope to continue finding peace...and how I hope others can as well!
alexanderwrites.blogspot.com/2008/09/help-doesnt-come-from-700-billion.html
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I have feeling that it would be much better if they did not even announced the bailout than announced it and then started to play political games around it...
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Your perspective is otherwise known as "trust leaders implicitly and don't ask questions". Foolish, in my opinion.
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Here's a couple good articles regarding the bailout:
Why the bailout affects you
tips.blogs.cnn.com/2008/09/30/why-the-bailout-affects-you/
This isn't just a Wall Street bailout!
money.cnn.com/2008/09/30/markets/thebuzz/index.htm-
It is a bailout to not hold CEO's and Board of Directors liable for any financial catastrophe for the "little people". The CEO's and BofD all need to be held accountable for their idiotic, greedy and sleezy decisions.
I don't care if the market tumbles. Let it. We should not be assuming the debt of corporations. Period. -
I fully agree that there needs to be more accountability on the part of the executives that are tied to shady dealings that helped get us into this mess. Many of those involved in the Enron scandal ended up behind bars and it's unconscionable that U.S. citizens are flipping the bill while many of these people escape scrutiny.
That said, I'm no economist and I can only trust the things I've been hearing and reading. I believe the bailout is a necessary evil to help shield the financial suffering many individuals and small businesses will feel as a result of it not passing. I hope that the right economic authorities were consulted on the matter and that the final bill will have the best chances for actually working as intended. I really hope the tax payers will get a well-deserved return on the investment and 'golden parachutes' for executives have been snipped.
I think cooper's posts along with other informed user's posts are worth reading. I also believe many of the links submitted by BC users - supporting and not supporting the bailout - will help citizens get a better grasp of the situation.
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The bail out is necessary it is unfortunate that Pelosi in her clearly partisan way said what she said but it is more unfortunate that most of these reps are scared to take a stand because it could hurt them if it doesn't work out. They are like banks- most of them really do not care about the people they care about their jobs and their pot entail gain, let us not fool ourselves. They are supposed to be leaders and I think they could have easily passed a package with some limitations which could also be a work in progress halting a certain amount of panic and the continued loss to all those retirement funds.
I've heard it's a credit crunch - that is bad for small business and some people. I've heard that there is really no problem with liquidity only credit, then I heard the opposite. I know the market lost trillions yesterday and retirement fund of millions of Americans went plop much of yesterdays loss will be unrecoverable. I think the gutsy thing to have done would have been to pass a bailout to prevent the trillion dollar loss yesterday and make the plan an emergent work in progress, not worry about a religious holiday making the stop gap measure a very short stop gap measure. Congressmen need to stop trying to hang the jury while waiting to see which way would be best for them to go politically. I think that is what happened, congress put there career ahead of everything and they are still doing it.
Congress needed to act, they didn't, we are going to be damaged, someone think only Wall Street will be more damaged but in reality the people will be hurt more than they know, it should have been handled emergently by congress and it wasn't. Shame on them. Cowards. -
If the Gov't took over all the foreclosed homes... then they would actually own something with value. These could be sold off and would bring revenue. Take the apparent burden off the banks... however foreclosures are only a small part of the problem.
Also am I the only one that heard that any bank in the US could draw from this 700billion. As in a Chinese bank in the US could actually bring in their debt and get relief? If someone else has heard anything about this let me know I can't find it but I'm pretty sure I heard or read somewhere something to that effect... -
They made no distinction, the judgment will be on what value to the people of this country that bank is in other words a bank, foreign based, which offers more value to the American people in way, of financing loans etc could be eligible for the bail out. Rightly so really as don't think for a moment American banking institutions are looking out for you anymore than foreign banking institutions are, and their contributions to our economy could be greater. So the gauge will be what the bank offers the people and would saving it be to our benefit.
The language changed late Saturday from "must be headquartered in this country" to an "expanded definition that could include all of those banks: “Participating financial institutions must have significant operations in the U.S.".
That was one of the sticking points which held it up. -
Did you all know that the Bush Bailout Plan would protect the Treasury Secretary Henry Paulson from lawsuits?? I find this to be very troubling. I am really pleased the bailout failed and hope that this provision would be erased from the bill.
Treasury Secretary Henry Paulson would be insulated from lawsuits under the $700 billion Wall Street bailout plan advanced by the administration.
The Daily Journal story quotes a partner in securities class action firm Coughlin Stoia Geller Rudman & Robbins who is a critic of the lawsuit ban. "Vesting a single unelected official with the right to basically control a large part of the market is dangerous at best," said partner Darren Robbins. "To also have that person be somebody who has immunity from any private right of action is a recipe for disaster."
abajournal.com/news/bush_bailout_plan_would_protect_treasury_secretary_from...
Do you really trust Treasury Secretary Henry Paulson? I don't! This is a man who stated only months ago: "I don't see (subprime mortgage market troubles) imposing a serious problem. I think it's going to be largely contained,"...."
www.reuters.com/article/gc06/idUSWBT00686520070420
Yeah, he has an eye for the economy and the best interest of Americans. [/sarcasm]
Other Paulson perspectives about the "contained" sub-prime mortgage crisis:
May 2007: Interview with Jim Lehrer -- www.zimbio.com/Secretary+Hank+Paulson/articles/2/Paulson+Gives+Bottoms+Up+S...
August 2007: www.boston.com/business/articles/2007/08/01/paulson_sees_subprime_woes_cont...-
Any action he takes has to be approved by congress, so for that reason, he should be protected. Unless he lies to congress, in which case he should be executed.
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I would pay to have the board of directors, CEO's and upper exec's lose all of their homes, empty their bank accounts, and liquidate their assets to pay for their own damn bailout.
They are the ones responsible for this - now why aren't more people screaming for the financial heads on the bailout platter?-
Oh I so agree!!!!! Do you have any source for the names of the Board members and CEO's??? What filthy scumbags. How can they live with themselves? Oh, that's right. They have no conscience.
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As much as I am against bailing out these well-fed Wall Street jerk-offs, I don't want to see small business owners suffer.-
Neither do I, voodoo, as I am so pro small business (surprise, surprise!).
The trickle down effect is staggering. Yet...
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why dont they give that money to every US citizen over 18? There is plenty of it to go around and pay off ALL the BILLS
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