McClatchy: Democrats battling to add restrictions to $700 billion bailout

[babylonsister]

Democrats battling to add restrictions to $700 billion bailout

By David Lightman and Margaret Talev | McClatchy Newspapers


WASHINGTON — Congressional Democrats inched close to agreement Monday on the terms of a $700 billion rescue package to stabilize shaky financial markets, but continued to encounter White House resistance to key points.

"The Bush administration has called on Congress to rubber-stamp its bailout legislation without serious debate or efforts to improve it. That will not happen," said Senate Majority Leader Harry Reid, D-Nev.

People close to the negotiations said that at least three areas of disagreement remained: limits on executive compensation at troubled firms, the terms of oversight of the Treasury's management of the bailout and whether taxpayers would gain an equity stake in companies that benefit from the bailout so that taxpayers could share in the firms' later profits.

President Bush said in a statement that "Everyone recognizes that it's not easy to write a bill of this magnitude in a timely manner," and added he was confident that an agreement could be reached.

Another wrinkle may be developing, however: Some lawmakers are concerned that the plan is too complex and hard to explain to constituents, making them wary of quick approval.

more...

http://www.mcclatchydc.com/227/story/52922.html

[stray cat]

1. Why don't they hold a fund raiser - Bush and McCain can be the first to donate!

[msongs]

2. "the only thing we have to fear is fear itself" - and being stampeded by bushco AGAIN time to

put the brakes on this rush job fear based bailout scam and take time to come up with something better that President Obama can live with.

Msongs
www.msongs.com/political-shirts.htm

[sendero]

3. I hope the Dems in the senate..

... don't fall for this. The country is in NO MOOD FOR BAILOUTS.

[MadHound]

4. It isn't the complexity or that it's difficult to explain that is turning us off

It is the fact that this is simply a bad solution to the problem. Granted, there are probably no good solutions, but doing nothing is, in this case, better in the long run than actually adapting this plan. We're not only going to be on the hook for a trillion dollars, but this bailout is going to lead to high, if not hyper, inflation. It could also provide the tipping for downgrading US Treasury bonds. Either one of these likely scenarios is bad enough, but the sad thing is this plan could very well set off both at the same time, driving our economy and our country into the ground.

[babylonsister]

6. This is what Congress was supposedly challenged with-from

Democracy Now. I don't see them doing nothing.

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=389&topic_id=4057340

[MadHound]

8. No, this is different

HamdenRice and DN are talking about the system of interbank transfers, the credit system, that allows banks to cash checks, etc. This is completely different.

If US Treasury Bonds are downgraded, that essentially means that the entire world thinks that we will have overextended our debt load and that we're going to have a tough time taking on any more debt(via selling US Treasury Bonds). That essentially means no more money for the US government, and worse yet it could spark off a massive sell off of US Treasury Bonds by their Chinese holders, which will really screw us.

As far as hyperinflation goes, well that's easy. Two things, the value of the dollar is going to tank even further with the passing of this bill. Adding that amount of liquidity automatically devalues a currency, coupled with the fact that many many people will be wanting to get out of dollars, and will be selling out, further devaluing the dollar. Bad enough situation here that will cause inflation to rise and rise. But the real kicker is there's going to be an immense amount of pressure to actually just fire up the presses and print our debt away.

Even the least harmful scenario here is far worse than simply letting Wall Street collapse, come in and clean up the mess. That would send us into a severe recession/depression. Bailing out as currently proposed will only provide a bridge for Bush to slide out on. But within six months, we'll be royally screwed. Such a bailout is territory we've never gone into before, and all of the economists I've seen or spoken with are scared shitless of a bailout.

[babylonsister]

12. Thanks for the explanation, MadHound.

I'm a confessed rube at this, but I just can't imagine Congress doing nothing when everyone else is screaming the sky is falling, at least on the m$m.

And do you have any idea what Dodd was referring to when he said Paulson scared Congress, but wouldn't elaborate further, if not the gold for food scenario?

http://www.democraticunderground.com/discuss/duboard.php?az=show_topic&forum=389&topic_id=4054172

snip//

Reporters asked Dodd to describe specifically what Treasury Secretary Hank Paulson said to lawmakers last Thursday that led to the sense of urgency on Capitol Hill this weekend. Dodd declined but compared his colleagues’ reactions to that of the 9/11 terrorist attacks.

[MadHound]

13. You're welcome,

I used to be a rube, but then fifteen years ago I met a wonderful economics professor and married her, now I understand a lot more about what's going on in the wonderful world of economics and high finance, too much so at times(keeps me awake at night).

Who knows what Paulson said to Dodd and others. Hopefully, if he was being an honest information broker, Paulson simply explained the liquidity problem to him and what that meant to the economy. That in and of itself is enough to scare people shitless. The trouble is this alternative that they're proposing is actually much worse IMHO, and now I'm really scared shitless since it looks like this thing is going to go through.

[babylonsister]

14. Krugman was just on KO; while he's a tad perturbed also, he also

suggests caution, claims there's no reason to be hasty. That made me feel better.

[avaistheone1]

7. This is JUST the bailout BEFORE the election...wait til the bailout AFTER the election

rumored to be anywhere from $45 trillion to $1,000 trillion dollars for derivatives.

Ready to pay for that one to for our friends on Wall Street? Our children and our children's children will be enslaved with debt forever.

[bemildred]

5. Look, Democrats control both the House and the Senate.

They will shortly increase their control of both houses. They do NOT have to "struggle" to do anything. If they want to, they can stop anything from becoming law. They hold all the cards.

[screembloodymurder]

9. No deal, no negotiations, no compromise.

WE'RE CALLING THE SHOTS!

[MadHound]

10. We who white man?

We aren't calling shit, simply because we live under the two party/same corporate master system of government. Each and every single one of the politicians who are going to be voting on this bailout have been bought and paid for by Corporate America. When Corporate America calls the tune, these politicians are going to dance because their corporate masters have invested lots of good money into buying the politicians and demand a return on their money.

One more good reason that we need publicly funded elections.

[PsN2Wind]

11. Require the Wall Street executives that have raked off billions

for moving other peoples money around to put up "matching funds". The should then have Toby Keith, Charlie Daniels, et al to put on a "Wall Street Aid" event (I have some doubts Willie would do it). With appearances by Chuck Norris, Jon Voight and other hot stars like that, they should have no trouble coming up with the money and it would come from those that truly care enough to give.

[babylonsister]

15. That's a helluva concert!

Not! :rofl: Though Charlie Daniels had some good music back in the day.