Monday, September 22, 2008

What are We Getting for Our $700 Billion?

In our last post ("There Has Never Been Anything Like This") we mentioned some doubts about exactly who is getting all that taxpayer money. That is, of course, the now mind-boggling $700 billion bailout proposed by the Bush administration, but without any details yet posted. It would be a stupendous mistake, almost as stupendous as the bailout itself, if all that money went unsecured to the very institutions that caused this economic melt-down to occur in the first place. 

Several writers in the news today are calling for public ownership of at least part of any company that accepts the bailout funding. That strikes me as not only fair, but obvious. I mean, if we are going use public money to fix something that private companies screwed up, then let's get some public ownership for our cash. I have no idea how that would work, but I do know that the government is not playing with Monopoly money--its real cash and more than some whole continents could muster. So for this real cash we should get real equity and the executives who let this happen should get tossed out of the plane real soon and without their famous golden parachutes. Really.  

I mean at least a lien for Pete's sake. Can you imagine Goldman Sachs lending any of us money to buy anything--a house, a car, a million shares of Microsoft, without taking back an interest in the property as security for getting their money back? Of course not. So why shouldn't the government take a piece of the pie for all their trouble? At least until the money is returned and with a lot of interest tacked on. I know Goldman and Morgan will understand.

(Sorry, we'll get back to condos before too long, but this is all way too interesting to ignore.)

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