Posted by politicalpartypooper on September 28, 2008

We Gonna Get Yo' Money

We Gonna Get Yo Money

Having read the entire Bailout Bill (all 105 pages?), the Emergency Economic Stabilization Act of 2008, which includes a program named the Troubled Assets Relief Program (TARP, aww…how touching), I can say this is a good deal for the American People.

It could have been better, but it’s not bad.  Congress and The Secretary of the Treasury actually remembered to include an end date for the plan, which is December 31, 2009, and extend-able through 2011 with sufficient evidence to Congress that additional economic assistance is required for stability in the overall financial markets.

Phew!  Am I glad I don’t write legal documents.

Here’s the gist of the plan from my perspective.  Financial Institutions will have opportunity for loans from the Fed, as well as opportunities to both sell troubled Mortgage Bonds and shares of stock to the Fed, or purchase insurance from the Fed to guarantee principal on mortgage backed bonds and debt securites.

The Secretary of the Treasury has the authority to name the amount of premium institutions will pay for insurance on their investments, and to control pricing on any securities or bonds the government purchases from troubled banks.  This is a good thing for banks, who don’t need the inuendos that would arise if they were allowed to have any say  in how their troubled securities and debts are valued.

Congress has oversight on just about everything the Secretary will do in this bill. Key to that was also adding caps on executive salaries, as well as eliminating Golden Umbrellas for the top five executives of any participating company for as long as that company receives Federal aid.

Key to American Taxpayers is that this isn’t free money being given to big investors and banks, which had earlier been feared.  At best, for lending institutions, this is a low interest loan.  At worst, it is outright government ownership (and thus taxpayer ownership) of bonds and securities which shall, in the case of stocks, be sold at profit, and in the case of bonds, be held until maturity, all the while collecting interest on the principal.  One caveat; bonds purchased by the government can be sold only if deemed profitable.

The earnings from these investments are to be used to reduce the National Debt, and in essence, pay taxpayers back.

The only thing I would do differently is to apply some of those earnings towards rebuilding the strength of our Social Security system.. I feel this is our best opportunity to do so, and I think in that one specific instance, Congress missed an excellent opportunity.

Otherwise, this “Bailout” works strongly in the favor of the American taxpayer.

That is my non-partisan perspective.  Today, Government gets an “‘atta’ boy!”


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