Treasury’s Financial-Bailout Proposal to Congress
I propose as title:
“A Temporary Solution to Save Our Collective Asses. But Don’t Expect our Kids to Say Nice Things About Us in 30 Years.”
Scope:
The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation:(1) appointing such employees as may be required to carry out the authorities in this Act and defining their duties;
(2) entering into contracts, including contracts for services authorized by section 3109 of title 5, United States Code, without regard to any other provision of law regarding public contracts;
(3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them;
(4) establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase mortgage-related assets and issue obligations; and
(5) issuing such regulations and other guidance as may be necessary or appropriate to define terms or carry out the authorities of this Act.
Sec. 3. Considerations.
In exercising the authorities granted in this Act, the Secretary shall take into consideration means for–
(1) providing stability or preventing disruption to the financial markets or banking system; and
(2) protecting the taxpayer.
Sec. 10. Increase in Statutory Limit on the Public Debt.
Subsection (b) of section 3101 of title 31, United States Code, is amended by striking out the dollar limitation contained in such subsection and inserting in lieu thereof $11,315,000,000,000.
Note the new and exciting 11 Trillion 315 Billion dollar Debt limit. That’s $11,315 Billion.
Note that the GDP (in Chained 2000 Dollars) is only 11,740.3 Billion (2q2008).
Item (2), above. Definitely an afterthought; prolly added to keep the hot tar, rails and pitchforks at bay. We’ll eventually need those items, methinks.crossed from home
You missed the VERY best part!
Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.
Commissar Paulson!
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Serious times we’re living in, my friend.
This might still go South. Then, we can kiss our life(styles) goodbye.
Got mule and plow?
The scary bit is we have one candidate who will look at raising taxes (and not just income tax, but Capital Gains tax) to solve the problem, which will exacerbate and prolong the problem. The other candidate may raise taxes as well, but I hope not.
The easy fix is to start jettisoning useless Federal programs. Return to basics. Have the US Government pay for the common defense, transportation infrastructure, postal service, and similar inter-state items, put a 10-year moratorium on earmarks, and cut out US Government services that are bloated and redundant (US Department of Education, for example– states should be handling the education of our kids, not the disconnected Federal Government).
And get some term limits in there.
Of course, you’d need to have some people willing to commit political suicide, because this involves cutting jobs and shutting the flow of money to pet projects in municipalities.
It’s about time for Glen “Gramm” Dean to step in and tell us how we’re a nation of whiners, innit?
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There’s really no class war (heh), but the really rich team just launched thermonuclear MIRVs at the have-nots, if anyone’s paying attention.
“Give us the money or your economy gets it!”
If it were up to me, I’d flesh-wound the hostage, and shoot the crooks in the head, in the aftermath.
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Can’t see your reasoning there, JP.
We gave in to the incorrect, feel-good, politically correct sentiments and forced banks to make loans to people for homes that they couldn’t possibly afford. Now, because of greed and shortsightedness, and political correctness, and nascent socialism, the economy is tanking. Only a major miracle will save the thing now.
Socialism.Doesn’t.Work.
Carefully read this. Written in 1997; celebrating the 20th anniversary of the Community Reinvestment Act…the smoking gun. The root cause of what’s happening today.
The Community Reinvestment Act, pushed through by Democrat activists in 1977, signed into law by Jimmy Carter, ignored by regulators under Reagan, pushed into high gear during Clinton’s term, challenged by Republicans in 1994 (they lost that fight, btw) and now, we see the (sorry, Glen) chickens coming home to roost.
From that link: (I hate the forced italics of the blockquotes; eyestrain, much?)
Fighting to Survive
“While some banks recognized that the increased pressures had pushed them to make what turned out to be profitable loans, most resented the growing scrutiny of their performance and called for rollback of the CRA. When the Republicans gained control of Congress after the 1994 elections, bank lobbyists convinced them to make the Community Reinvestment Act a prime target. The prospects for survival of a meaningful CRA looked bleak as the confident Republicans, led by senators Richard Shelby (Alabama) and Connie Mack (Florida) and Florida Representative Bill McCollum, offered a series of innocuous-sounding “reforms.”
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“The banks’ Republican allies offered three arguments to support their position, none of which could withstand serious scrutiny. First, they claimed that the CRA imposed a massive regulatory burden on small banks. While grossly exaggerated in any case, this claim was rendered obsolete by an overhaul of CRA regulations in early 1995. The revised regulations replaced an excessive emphasis on process and paperwork with a focus on actual performance, and drastically streamlined the process for banks with less than $250 million in assets.
“Second, CRA opponents claimed that it requires risky loans that could undermine a bank’s profitability and threaten its survival. Actually, the reverse is closer to the truth. The 1980s were marked by massive speculative lending to wealthy real estate developers and get-rich-quick schemers that resulted in the failure of more than two thousand banks and S&Ls. Yet not a single bank failure has been caused by making too many bad loans to disadvantaged borrowers. ”
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“The swell of grassroots support overwhelmed pressure from industry lobbyists and produced unanimous opposition by congressional Democrats to every proposal that would have weakened CRA. In addition, the Clinton administration never wavered from an early pledge to veto any bill containing such provisions. (Of course, since supporting the CRA required virtually no budgetary resources, it was easier for Clinton to take a strong stance.) When the dust of battle finally cleared at the end of 1996, the CRA emerged intact.”
Smoking gun, JP.
Socialism.Doesn’t.Work.
That’s why it’s the solution now, see? Privatize the profit; socialize the loss!
Income redistribution, upward! Aren’t you all in favor? Yes, you certainly have supported it in the past.
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Just don’t come to my cardboard box and ask for a hit off my beer, you stupid motherfuckers. Wallow in your own cesspool.
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Ummm..JP. You won’t have to live in a cardboard box. Promise.
But…maybe a nice Hooverville?
Instead of a cardboard box, JP, maybe a mattress for your ca$h…
Top Economist: Americans Should Worry About Bank Deposits if Congress Doesn’t Act
don’t worry. ‘The fundamentals of the economy are strong’ lol!!!
PLEASE get the quote from McCain right. He did not say “the fundamentals of our economy are strong”. Here is what he actually said:
“Our workers are the most innovative, the hardest-working, the best-skilled, most productive, most competitive in the world. That’s the American worker. And my opponents may disagree, but those fundamentals — the American worker and their innovation, their entrepreneurship, the small business, those are the fundamentals of America, and I think they’re strong. But they are being threatened today.”
[…] responded to JP’s comment yesterday, left on my post on the Treasury’s proposed trillion-dollars […]
Here is what he actually said
That’s what he said AFTER the rest of America said “WTF economy is he talking about?”
Oh yes, McPouchy sure does believe in the American worker.
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All whiners, no doubt. Suck it up!
All whiners, no doubt. Suck it up!
I always take my financial prognostications from a guy who, near the peak of the real estate bubble, decided to switch careers and become a Realtor.
Love ya, man.
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Ummm…trade talks are underway, JP.
Just so you know.