The public, faced with what they see, rightly or wrongly, as a giveaway "bailout" to big corporations that made profoundly stupid decisions, is irate. So what do you suppose would be the single worst thing you could do, at this point? I mean, the very, very worst -- something that screamed "we're going to fleece you all for every penny, and if you object we'll drive the economy into the ground around you."
I'd say "pair the bailout with more tax cuts" is probably right up there, on the Screw The Public scale. From AP:
Majority Leader Harry Reid and GOP Leader Mitch McConnell say, however, that they're going to add a tax cut package already rejected by the House on Monday.
The bipartisan move caps a day of behind-the-scenes maneuvering on Capitol Hill over what sweeteners to add to the bill to attract votes from House Republicans.
Reid and McConnell's move may prove popular with Republicans, but it risks a showdown with House leaders insisting that a popular measure extending certain business tax breaks be financed by tax increases elsewhere in the code.
Of course. Naturally -- when in doubt and you have a sucky plan, make it much, much worse in order to attract a few whining, petulant House Republicans who couldn't find their asses with two hands and an ass-finding device.
Same thing. Every damn time, it's the same thing. If the Republicans proposed a rule that Democrats could no longer wear pants on the Senate floor, the Democrats would agree to it, just to be accommodating. And then they'd look at us like we were idiots when we got mad at them for it.
So fine, my position has changed. I was previously "skeptical" of the Paulson plan. Now I want it to die a hot, flaming death. I want its ashes to be fed to goats, and the goats fed to sharks, and the sharks put on a rocket and fired into the sun. I want the whole premise to be made Unspeakable, so that future generations shun anyone who even threatens to mention it.
Lest you think it couldn't get worse still, we've got another idea that's been floated from everyone from conservatives to progressives, thanks to intense pressure by the companies in question:
Another possible change to the bill would call on regulators to modify "mark to market" accounting rules. Such rules require banks and other financial institutions to adjust the value of their assets to reflect current market prices, even if they plan to hold the assets for years.
Some House Republicans say current rules forced banks to report huge paper losses on mortgage-backed securities, which might have been avoided.
There was a note of irony in that proposal. One Republican familiar with the discussions conceded it amounted to step toward deregulation at a time when Obama, McCain and House members in both parties are clamoring for greater controls on the financial industry.
Of course, we got away from "mark to market" accounting for the very reason that it was so manipulatable, and companies were using it to cook their books, leading us to situations where companies were reporting inflated asset values to investors while in reality being financially quite sick. And that's exactly why it's so wanted now, in the current situation: instead of forcing companies to report an estimated current value for their "toxic assets", we can make this whole problem go away by simply letting the companies report theoretical "future" values for those same assets -- the same as they were doing in years past, leading to this very bubble. Sure, it'll be papering over the problem for a little while longer, but that's exactly what all the companies in question (and a lot of legislators) fervently want.
Conservatives have been looking hard for ways to blame the current economic mess on the public, or cruel taxes, or those shifty brown people. They've assured us that the market will just fix itself, if we do blah blah blah. And they've got a thirty year history of being so completely wrong about anything even vaguely associated with any of this stuff that you'd have to be a very special kind of moron to believe them about anything, at this point. What exactly about "let business make up it's own, less stringent accounting rules" was working, in the past? Where are the piles of cash that were supposed to be generated from tax cut after tax cut on the most wealthy? How has that all been working out, during this administration?
Serious voices have been talking about institutional fixes like a transaction tax, rules for short selling, etc., and shorter term fixes like mortgage relief, liquidity fixes and the like, but all the Republicans can fart out is "more tax cuts for business!" and "deregulate, so business can do what they like!" Of course. Let's all pretend that there's any rational logic involved in just throwing more tax cuts at the companies, in the hopes that their slightly-improved bottom lines will eventually "trickle down" enough to make up for the gawdawful mountain of debt about to be piled on us.
We live in a damn kleptocracy. Face a financial crisis, or do whatever business wants: that's the only apparent choices under consideration here. I hope that if the worst happens and another truly large depression does come, the American people have the collective resolve to tar and feather all these people. We can send them out into the ocean on a garbage barge with an ample supply of food, water, and talking points, and whichever country wants its economy similarly wrecked is welcome to give them a home.