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Robert Reich On Accountability In Wall Street Bailout Deal
John Q. Public and Jane Taxpayer ask:
Why should Wall Street get bailed out by me when I’m getting screwed?
Your congressional representative is in a position to demand from Wall Street certain conditions in return for the blank check. Here are a list of five suggestions from former Labor Secretary in the Clinton administration, Robert Reich:
“1. The government (i.e. taxpayers) gets an equity stake in every Wall Street financial company proportional to the amount of bad debt that company shoves onto the public. So when and if Wall Street shares rise, taxpayers are rewarded for accepting so much risk.
2. Wall Street executives and directors of Wall Street firms relinquish their current stock options and this year’s other forms of compensation, and agree to future compensation linked to a rolling five-year average of firm profitability. Why should taxpayers feather their already amply-feathered nests?
3. All Wall Street executives immediately cease making campaign contributions to any candidate for public office in this election cycle or next, all Wall Street PACs be closed, and Wall Street lobbyists curtail their activities unless specifically asked for information by policymakers. Why should taxpayers finance Wall Street’s out-sized political power – especially when that power is being exercised to get favorable terms from taxpayers?
4. Wall Street firms agree to comply with new regulations over disclosure, capital requirements, conflicts of interest, and market manipulation. The regulations will emerge in ninety days from a bi-partisan working group, to be convened immediately. After all, inadequate regulation and lack of oversight got us into this mess.
5. Wall Street agrees to give bankruptcy judges the authority to modify the terms of primary mortgages, so homeowners have a fighting chance to keep their homes. Why should distressed homeowners lose their homes when Wall Streeters receive taxpayer money that helps them keep their fancy ones?
Wall Streeters may not like these conditions. Well, you should tell them that the public doesn’t like the idea of bailing out Wall Street. So if Wall Street doesn’t accept these conditions, it doesn’t get the blank check.”
We concur wholeheartedly. No bailout for inept Wall Street money managers without specific conditions and proper oversight regulations. We’ve been around long enough to know for sure whenever we hear the words, “deregulation is good for consumers” we realize we need to hold on to our skivvies, ’cause we’re ripe for the rip-off.
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