A slightly different plan from the plan proposed to the House a couple days ago has just been passed by the Senate by a vote of 74-25. Since the last post concerning the bailout generated such large amounts of feedback, I would like to hear everyone's opinion and reactions to the passing of this slightly tweaked plan.
Here's several details on how the plan is different from the plan proposed to the House (quoted from a cnn article)
"
- The package adds provisions to the House version - including temporarily raising the FDIC insurance cap to $250,000 from $100,000.
-the bill allows the FDIC to borrow from the Treasury to cover any losses that might occur as a result of the higher insurance limit.
-It would extend a number of renewable energy tax breaks for individuals and businesses
-The Senate bill would also continue a host of other expiring tax breaks.
-The bill includes relief for another year from the Alternative Minimum Tax, without which millions of Americans would have to pay the so-called "income tax for the wealthy.
"
11 comments:
I was actually watching the CNBC report on this with my dad a little earlier. I thought it had a good take on it.
http://www.cnbc.com/id/15840232?play=1&video=874935311&__source=yahoo|headline|other|video|&par=yahoo
-Kimiya Bahmanyar
The provisions are clearly to protect the wealthy even more.
Hurray, more debt .
Now we need to wait for the house to approve... But if we keep tax relief up, how will the government cover the huge deficit that will drive the dollar down? I am all for tax cuts, but we need to stop spending so much otherwise tax cuts will hurt America in the long run. I think they should have put more regulations on the banks. Even if they do this much, the housing market really needs to improve before banks will start doing better. If less people want to get loans, banks won't make much money. So i think the bailout plan is great, but we need an extension to deal with the housing issues and hope the banks dont make dumb mistakes again.
I'm really disappointed in the Senate (particularly Senators Obama and Biden) for passing this bill. I don't care how much Mr. Corti and Mr. Silton played this thing up yesterday, this bill is the WRONG solution for this country.
What this bailout does is give money to the richest business sect of America, the guys who already screwed up. But it doesn't help out those who are suffering from the screw-ups, like the millions of families now facing foreclosure on their homes. This is NOT the right solution, and that's why 95 Democrats in the House broke with party leadership, because they know that this is not the right solution.
The richest 400 Americans own MORE than the bottom 150 million Americans combined. (For reference: the richest 0.000133% of Americans own MORE than the bottom 50% of Americans combined.) Their combined net worth is about $1.6 trillion, and that number has increased by, coincidentally, nearly $700 billion since the beginning of the Bush administration. And we're going to give these rich people the bailout money to spend however they please?
Rather than sink our country into even more debt to line the already-lined pockets of the wealthy, a true bailout plan should make the rich pay for their own bailout. If they really need this $700 billion, then a) Require every couple making over $1,000,000/year and every single taxpayer making over $500,000/year pay a 10% surcharge tax over the next five years. They'll still be paying lower income taxes than when Jimmy Carter was president, and this will raise $300 billion. b) Charge a 0.25% tax on every stock transaction (nearly every other democracy does this), which will raise $200 billion in a year. c) Ask those very patriotic stockholders to forgo receiving a dividend check for one quarter, and have the money go to the treasury to help the bailout. d) Here's the nuclear option: Raise corporate income tax back to the level of the 1950s. 25% of major U.S. corporations currently pay no federal taxes, and federal corporate tax revenues are currently only 1.7% of the GDP, compared to 5% in the fifties. This would raise a whopping $500 billion, and the rich will still have enough to pay for those servants and multiple houses and that yacht, etc.
The people we need to bailout are the people who are losing their homes. There are 1.3 million homes in foreclosure right now. If we pay down each of these mortgages by $100,000 (as long as this only applies to an American family's primary home, not their second or third or fourth home) and force the banks to renegotiate the mortgage at the current market value. And in return for the government's investment in the mortgage, the government gets to share in the holding of the mortgage so it can get some of its money back, making the cost of THIS bailout only about $150 billion.
Finally, we need to appoint a special prosecutor who will criminally indict anyone on Wall Street who knowingly contributed to this collapse, whether it be insider trading, securities fraud, or anything else that was done to knowingly contribute to this mess. They're out there, because a bunch of major corporations just don't all go belly-up at the same time for no reason. Rather than giving those same people $700 billion more to toy with, we've got to find them and make sure they're brought to justice.
And lastly, we need to stop discussing this in a state of panic. The corporate-owned media will lead you to think that we're in the biggest recession since the Great Depression and how dare the House not pass the bailout bill--interestingly enough, we're not yet in that "worst since the Great Depression" stage. On Monday, everyone said that the stock market had its biggest crash in history. In terms of points, that's true, but in terms of percentages, the stock market only fell by 7% on Monday. During the recession of 1989, the stock market fell 13% on a particular Monday, 3000 banks closed down, but we survived! (And in the middle of the Reagan-Bush years, no less!) This $700 billion bailout plan is something that should be debated with care, not with panic, and it should be voted down. Giving this money to the very people who created this mess (and who already have more than enough money in their pockets) is the wrong solution, and I hope with all my heart that the House will not give in to pressure and will turn down the Senate's bailout bill.
A bailout that both will cost billions of dollars and drive our country into debt and give tax cuts that were soon to expire more longevity. Makes sense... since we are going to be spending money we don't have, we should not try to increase revenues. Though it might be an attempt to alleviate the effects of the bad economy on tax payers through keeping taxes lower or an attempt to make concessions to the republicans who did not vote for the bill earlier, what logic are these lawmakers using? This crisis was caused by people using borrowed money and then not being able to pay it back and now the government is spending money it does not have and decreasing the amount of money it will get.
Although I am disappointed at how much more this is in favor of the wealthy, I am glad about the tax breaks for renewable energy, but that is certainly no compensation for what the rest of this plan does.
I can't believe that they passed the bill! 7 billion dollars is A LOT of money and when we are in debt, it is not a good idea. Mr. Corti was saying the other day, although, by voting yes on the bill, it looks like they tried to fix the economy, it might have not been the right decesion. By voting FOR the bill, if the bill fails to improve anything, it will be a waste of money, it will not fix the economy and it will end and destroy your political career. not good.
Obivously helps the rich and wealthy, but its also a step to slowly to start fixing the economic problem. Although the 7 Billion dollars seems a bit too much, if the plan fails, then the parties are screwed. How do we know this bill will work? The origianl bill did not get passed because too many senators believed it wouldn't so, how ceritn can it be that this bill will be any different?
Although I don't necessarily agree with all the provisions of this bill, I think it's an important step that the Senate (and hopefully the House) will restore the public's confidence in America's economy by passing something. We saw the reaction to the no-vote in the House, and that was great. NOT. A couple more days with more than 700 point drops at the NYSE and we're just asking for another Great Depression.
I think one of the provisons that makes a lot of sense is increasing the insurance covered by the FDIC. This way, with $250,000 covered, people will hesistate and think more about their desicion before pulling their funds from banks and creating more havoc. Overall, I'm glad Congress is trying to work on a more bipartisan level on a plan that might not be the best plan, but it will prevent a much more serious crisis.
Douglas does make a good point, but forcing the wealthy to use their money is not a very good solution, as there are pretty obvious moral issues involved there.
I believe this 7 billion will help just a little. Since it's free money, of course they're going to spend it all, or else look very bad (and lead to their demise). The problem is that the money really isn't all that much... that whole keynesian economic stuff could do more if more money is spent. Hopefully this bill could be a push for the wealthy to start spending some more cash, if they get the hint.
I think Douglass makes a decent point but it may perhaps be a little extreme. Such a drastic change probably won't be too good for the nation. The plan seems to favor the wealthy and upper class a little too much. if the banks managed to get themselves into this situation, whats to say they won't do it again with the 7 billion dollars that we will be providing them as relief. If the banks continue to fail then that vast sum of money would have only prolonged the inevitable and our nation would only be even further in debt. I think that passing the bailout plan is not the right or best answer but it seems to be, however, the only answer for the nation at the time as i think doing nothing is clearly not the right course of action.
Post a Comment