Should There Be A Bounty On Plutocrats?
"Malefactors of great wealth" - what a wonderful phrase uttered by Teddy Roosevelt against certain Wall Street plutocrats as he pushed his Square Deal reform program at the turn of the last century. Sadly, while Teddy is gone another generation of plutocrats is still causing market turmoil and the trust busting Bull Moose is probably spinning in his grave at the thought of a $700-billion bailout to save Wall Street from itself. That, of course, comes on the heels of a $29-billion Bear Sterns bailout, a $200-billion Freddie Mac and Fannie Mae bailout and an $85-billion AIG bail out. Apparently bailouts are the magic of the American marketplace - greed and mismanagement pay off big time and the taxpayers foot the bill. Get your MBA now.
When will we ever learn that industries and Wall Street, in particular, cannot regulate themselves? In the early 90's the feds (read taxpayers) had to put up $300-billion to bail out the savings and loan industry (remember the Keating Five?). Now it's the turn of investment and commercial banks. Through deregulation, speculation and greed they mined and impoverished Main Street while Wall Street banks handed out $62-billion in bonuses in 2006 and somewhat less in 2007. Lost your health benefits? Lost your pension? Lost your house? Thank Wall Street, which is where your money went. And now the plutocrats want more. There should be a steep price to pay.
If the Bush administration wants to bail out its Wall Street friends then it should impose the following conditions:
1. Seize all the assets of the investments banks, their directors and top management as penalty for their poor judgment and unlimited greed.
2. Split investment and commercial bank functions - no more blurring of lines.
3. Impose new regulations with more teeth and transparency and prohibit bizarre financing vehicles (i.e. money-fleecing scams) that no one understands.
4. Break up Freddie Mac and Fannie Mae.
5. Institute criminal investigations against Wall Street bankers.
6. Impose a 100% surcharge on all Wall Street bonuses handed out over the last three years.
Bailouts are serious business and Wall Street more than anyplace should feel the pain. Their free ride is over and while it is rumored that 40,000 Wall Street workers could loose their jobs, it pales in comparison to the millions of real Americans who lost their jobs to Wall Street-driven outsourcing and downsizing. Brother, I can spare a dime but not $700 billion when it comes to Wall Street.
My advice to Dubya - instead of a bailout for the plutocrats, how about a bounty? I'm sure millions of Americans would be interested.
Reprinted courtesy of Engineering News-Record, Copyright The McGraw- Hill Companies, Inc., September 24, 2008, All rights reserved.