Just how much do you trust this guy? $4,500,000,000,000 (Trillion) worth?
Been a long time since I posted here. But today, I’ve seen several posts praising Chuck Schumer and Nancy Pelosi over this alleged deal supposedly ”negotiated” with Mitch McConnell. A deal which appears to me to be the biggest sell-out yet by the Democratic establishment to the absolute worst elements of our society.
The emergency coronavirus legislation that the Senate agreed to on Tuesday can only be described as an outrage. It is not an economic rescue package, but a sentence of unprecedented economic inequality and corporate control over our politics that will resonate for a generation. {Author’s note: “Generation(S)” would be a better descriptor.}
It represents a transfer of wealth and power to the super rich from the rest of us, with the support of both political parties ― a damning statement about the condition of American democracy.
Final text of the bill has not been released, but according to a legislative draft, the new law would establish a $4.5 trillion corporate bailout fund overseen by Treasury Secretary Steve Mnuchin, with few substantive constraints. The bill permits bailed out companies to lay off up to 10% of their workforce over the next six months, with no restrictions thereafter. Mnuchin would have authority to waive any upside for the public in its new investments, and the bill’s restrictions on stock buybacks at bailed-out firms are too temporary to be significant. Bailed out companies could even pay dividends to their shareholders.
Zach Carter at HuffPo.
MSNBC and every other MSM outlet, including the front page here at DailyKos, seems to be rooting for this legislation, citing excitedly the $2,400 couples will receive, etc. Kind of like G. W. Bush gave everybody a $500 tax cut, except it was much more for those in upper income brackets, remember that?
Here’s another rhetorical question: Just how good of a job has Chuck Schumer done in negotiating with Mitch McConnell the last few years? Seen a lot of good judges appointed the federal bench lately?
Here’s what David Dayen has to say about this deal that so many here seem to be rah-rah-ing.
Twelve years ago, banks asked for a bailout after years of irresponsible, highly leveraged lending. The Treasury Department put out a three-page term sheet seeking money from Congress with no strings attached, even eliminating judicial review. Democrats balked, called it a slush fund and worse, then agreed after a few mostly meaningless bits of oversight and some promises to help ordinary people. That $700 billion bailout was window dressing for trillions that came from the Federal Reserve, but it kept Congress quiet, hooking them into the rescue of the system.
Twelve years later, virtually the same course of events is taking place. After just a couple weeks of extreme social distancing measures, the Treasury Department asked for a large bailout, this time of the entire corporate sector. The bill as written initially would have made all bailout activities secret for six months. Democrats balked, called it a slush fund and worse, and then agreed to a few mostly meaningless bits of oversight and some promises to help ordinary people. In fact they’re the same bits of oversight from the 2008 TARP bailout: a five-member oversight panel and an inspector general for the program.
The enormity of this bailout is being under-reported. The number you’re hearing is $500 billion. Of that, $75 billion goes to the airline industry and the mysteriously named “businesses critical to national security.” The other $425 helps capitalize a $4.25 trillion, with a T, leveraged lending facility at the Federal Reserve. The taxpayer dollars would soak up any losses from that lending program. The loans won’t be secret anymore, but the oversight is largely after the fact, without subpoena power, and mainly reduced to writing reports. How exactly do you expect a small, underfunded panel to find fraud in a $4.25 trillion lending facility! Especially when the current administration explicitly believes they are not required to turn over anything to Congress.
So it’s not a $2 trillion bill, it’s closer to $6 trillion, and $4.3 trillion of it comes in the form of a bazooka aimed at CEOs and shareholders, with almost no conditions attached.
The American Prospect
So, Schumer and Pelosi are going to trust Steve Mnuchin to report, in a timely fashion, what he’s doing with $4.5T. With a 5 member panel charged with “oversight,” dependent upon what Mnuchin tells them.
The same Mnuchin whose been under a mandatory statutory requirement to turn over Trump’s tax returns for three years, and who has, essentially, told Congress to suck his jock strap before he’ll comply.
JFC. Please tell me that y’all aren’t falling for this latest example of kabuki theater. If you believe that Schumer and Pelosi have your/our backs, I’ve got a beautiful castle in Scotland to sell you, where you can watch Nessie play with her little plesiosaurs every morning just before sunset. Message me for details.
Having gotten that off my chest, let me offer this simple idea as a way of achieving some level of actual help for those who aren’t able to employ an army of lobbyists (aka, you and me).
Parity.
par·i·ty 1
(păr′ĭ-tē)
n. pl. par·i·ties
1. Equality, as in amount, status, or value.
2. Functional equivalence, as in the weaponry or military strength of adversaries: "A problem that has troubled the U.S. -Soviet relationship from the
beginning has been the issue of parity" (Charles William Maynes).
For every dime the corporations receive in tax breaks and subsidies, each and every American should receive an equivalent tax break and/or subsidy. For every dime “loaned” to the big banks at ultra-low or even negative interest rates, the same number of dimes should be available to you and me, at the same interest rates. We’re in a class war: Shouldn’t we strive for parity with our opponents?
Here’s just one, not-terribly-well-thought-out example. I’ve read different estimates of how many people are currently living in the U.S., some at 320M, some at 350, etc. Let’s use 350 million. If you gave every one of those people, every person in America, $10,000.00, that would be $3.5 Trillion. Less than we’re handing over to Steve Effing Mnuchin. By a Trillion $. I don’t know about you, but $40k would go a long, long way for my family of 4. But hey, Chuck and Nancy are going to make sure we get less than a quarter an eighth (1/8) of that, so they’re our heroes! Thank you sooo much! And while we’re at it, let's remember to thank Harry Reid! Still waiting on that floor vote on a Public Option, Harry. Think you can talk Chuck into it before you the cancer cashes you in? (Okay, that may have been a little too much.)
But hey, when Mitch and the rest of the Senate come back in late April and want to pass another 6 or 8 Trillion in bailouts for the Billionaires and Big Biz, I'll be happy to get another $60k or $80k. Seriously, I would happily take that. Wouldn’t you?
Parity. Not another dime for bailouts for banks, billionaires, or businesses, without an equal dime for every American. Just an idea.
*Postscript: I just think we’d ought to not be panicked into another sell-out to disaster capitalism. For another perspective, consider what Michael Hudson has to say (I highly recommend reading the entire interview):
Imagine if Citibank would have been taken into the public domain and made a public bank. It wouldn’t have made more crooked loans. It would have made loans for what people and business actually needed. But Obama invited the bankers to the White House, and promised to protect them from the “mob with pitchforks.” The mob with pitchforks were his own voters, his supporters, the people whom Hillary called deplorables – mainly indebted wage-earners. Obama said that he would protect the banks from loss and not to worry about Congressional reprisals.
Posing as a black civil rights icon, Obama bailed out the banks – his major campaign sponsors and donors – so generously that not only did they not go under, but they are now gigantic as a result of the bailouts and designation as Too Big to Fail (TBTF) driving out the small smaller banks. Obama didn’t write down the mortgages as he had promised voters. I think he was the worst U.S. president in a century, because the economy stood at what couldhave been a turning point with real hope and change. He’d promised to write down the mortgage debts to the realistic value of the buildings instead of the inflated value that Citibank, Bank of America and Wells Fargo and other crooked banks had put on them. Instead he let them go ahead foreclose on 10 million American homes.
(snip)
But most of all, the crisis gave Trump an excuse to give enormous bailouts to Boeing and the airline companies that already were near insolvency as a result of their own debt problem. They hope to use the crisis not to revive the economy, but to just pound it into debt deflation, leaving the debts in place while bailing out the banks and the landlord class. While people are losing their jobs, especially part-time workers or those who work in retail stores, bars and restaurants. They are laid off and can’t pay their rent. Their employers often are small businesses who also can’t pay their rents. Already there are for rent signs all up and down the big streets here in New York. The threat is that the landlords will not be able to pay the banks, because they won’t have tenants. So there’s a rising wave of arrears for all kinds of debts.
The rate of arrears and missed payments is one way you tell when debts are too large to be paid. They are mounting and are up to 30 or 40 percent for student debts. They’re rising for automobile loans, and many mortgage debts are also in arrears. So basically the virus crisis has become a vehicle to bail out the both the landlord class and keep the banks afloat while sacrificing the wage-earning population. m
From: Debt and Power: An Interview with Michael Hudson
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