LinkThis is what the American taxpayers are going to be thinking:
...if the government is going to provide capital to financial firms, it should get what people who provide capital are entitled to — a share in ownership, so that all the gains if the rescue plan works don’t go to the people who made the mess in the first place.
That’s what happened in the savings and loan crisis: the feds took over ownership of the bad banks, not just their bad assets. It’s also what happened with Fannie and Freddie. (And by the way, that rescue has done what it was supposed to. Mortgage interest rates have come down sharply since the federal takeover.)
But this bailout plan looks more ominous than simply having the taxpayers eating the bad debt:
But Mr. Paulson insists that he wants a “clean” plan. “Clean,” in this context, means a taxpayer-financed bailout with no strings attached — no quid pro quo on the part of those being bailed out. Why is that a good thing? Add to this the fact that Mr. Paulson is also demanding dictatorial authority, plus immunity from review “by any court of law or any administrative agency,” and this adds up to an unacceptable proposal.
And here's an opinion from
Kos that pretty much predicts what Naomi Klein talks about in
the Shock Doctrine.
The opinion cites an op-ed piece from the NYT that makes the point clear:
The administration’s plan would allow the Treasury to hire staff members and engage outside firms to help manage its purchases. And officials said that the administration envisioned enlisting several outside firms to help run the effort to buy up mortgage-related assets.
Is the Bush Administration using this financial crisis as another opportunity to apply the shock doctrine? Are going to have another *goshdarn* Blackwater guarding the henhouse on Wall Street?
