Thursday, September 25, 2008

Yes, Explain It, Why Don't You

If there is one thing worse than watching the American economy implode, it's watching our president condescendingly explain things to the American people as I did last night.

It wasn't so much the smirk that the man perpetually wears in public. It wasn't the gall of someone who demonstrably cannot handle finance explaining same to the little people. It was both of those together, really.

Understand, I'm not suggesting the president caused the problem (though there does seem to be a disturbing pattern in which a member of the Bush family sits in the oval office and banks start failing), but it is happening on his watch and you'd think the man would take time out of his busy lame-duck schedule to get up to speed and have some ideas of his own other than to wait and see what happens, which is what he wants to do. I know this because that's what he's been saying in one way or another for months now as the clamour from the so-called market experts and economists he keeps around for laughs has risen to what must be by now unbearable stridency.

The man with the plan, Paulson the Secretary of the Treasury, was deliciously vague in that plan on what would be needed other than on two points on which he was quite direct (according to the press): The amount of the first Taxpayer-supplied installment (700 000 000 000 dollars which has been expressed as around 5000 dollars per person though I haven't checked the math) and the need for total legal indemnity for Paulson for whatever he has to do.

One can only speculate what high crimes are being contemplated in the name of capitalism.

One thing both the president and Paulson have been adamant about in the face of increasing public hostility is that they saw no reason to forbid the taxpayer-supplied funds being used to float the golden parachute "bonuses" and severance payments to anyone shirtcanned in a bailed-out corporation. It's easy to imagine why. In all likelyhood the people concerned have all at some time in the past stood naked in a cellar hung with banners bearing greek letters while they beat each other's backsides with a wooden paddle in the name of eternal fraternity.

Last night the press of public opinion finally bore some weight as the president read his carefully prepared speech which included the warning to all concerned that the funds would not, now, be available for departing executives to pack their pockets with. Not only that, government experts say the taxpayers will even get "most" of the money back, eventually, probably.

Well, it was a start, but I've some questions for the president and his pals in high finance

When I wanted to borrow money from these banks in the past, I've had to prove that I either didn't need the cash or that I did need it but could reasonably expect to pay it back with high interest. Anyone who has raised a mortgage knows what I'm talking about here. Instead of vague promises and a big bucket o' cash for the lucky few, how about these institutions sign a loan deal with the taxpaying public? How about they pay interest on the money they need to prop up their shoddy, ill-run businesses? How about the taxpayers get a direct benefit by having a tax credit equal to that 5 kilobux and perhaps half as much again in interest? After all, in these deregulated, zero-oversight days, doesn't each individual taxpayer have as much right to indulge in buying up bad debt as his/her high street bank and pension fund have been doing all through this sorry affair?

And just how you qualify for a "bonus" when you've helped steer your firm into financial ruin is beyond me.

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