Secretary of Treasury Henry Paulson wants $700 billion dollars of taxpayer money so that the federal government can buy garbage mortgage-backed securities from banks and financial institutions and bail them out of their own self-created financial catastrophe.The White House says there can be no changes to the Paulson plan ($700 billion with "unlimited discretion" how to use the money and immunity from any review) and the plan must be passed by Friday or there will be "severe consequences."
Apparently the financial system meltdown that will result from not passing the Paulson Plan with no strings attached on Bush's timetable will come in the form of a mushroom cloud.
Gene Robinson of the Washington Post argues giving Treasury $700 billion of bailout money without getting some measure of equity and accountability is crazy:
Let's be clear about why we're facing a crisis that could pull down the global financial system. The irresponsibility of individuals who bought houses they couldn't quite afford pales in comparison with the irresponsibility of the financial wizards who built on those shaky mortgages a towering edifice of irrational faith. Someone in the government should have looked at all those trillions of dollars' worth of mortgage-backed securities and collateralized debt obligations and credit default swaps and demanded that Wall Street prove that all, or even most, of this purported money was real. But we're in the eighth year of the Bush administration; adult supervision left the building long ago.
Now that the whole highly leveraged structure is threatening to fall, some kind of government bailout is necessary and inevitable. But Congress shouldn't approve Treasury Secretary Henry Paulson's $700 billion rescue plan without insisting on some measure of equity and accountability.
See, neglecting such details as equity -- in both senses of the word -- and accountability is what got us here in the first place.
Last Thursday and Friday when Wall Street thought they were getting the bailout without the strings, the markets went up, up, up. Yesterday, when it became apparent that clearer heads may prevail and some measures of accountability will be added to the bailout dough, the markets plummeted.
Looks like the masters of the universe and the hedge fund managers on the Street don't want any accountability.
I guess accountability is only for teachers and other poor schlubs like that.
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