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My Message to Congress: No Blank Check

The current bailout proposal as I saw it Tuesday afternoon is not acceptable. It gives money without requiring a change in the behaviors that required the bailout. And it allows one man to dole out $700B. Not even John McCain likes this deal.

Here’s the message I just sent to all three members of the Alaska Congressional Delegation and I invite you to send it or words of your own to your own Congressman and Senators:

No Blank Check for Bailout! No one can stop the business cycle. Even if this $700 Billion bailout would stop a recession today, we will have a recesssion in the future. It’s part of capitalism. That’s why Congress should TAKE TIME on a bailout plan. At the absolute minimum, there must be a bipartisan oversight board as proposed by Senators John McCain and Barack Obama. Ideally it would follow the recommendations found at http://tpmcafe.talkingpointsmemo.com/2008/09/21/what_wall_street_should_do_to/index.php:
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1. The government (i.e. taxpayers) gets an equity stake in every Wall Street financial company proportional to the amount of bad debt that company shoves onto the public. So when and if Wall Street shares rise, taxpayers are rewarded for accepting so much risk.

2. Wall Street executives and directors of Wall Street firms relinquish their current stock options and this year’s other forms of compensation, and agree to future compensation linked to a rolling five-year average of firm profitability. Why should taxpayers feather their already amply-feathered nests?

3. All Wall Street executives immediately cease making campaign contributions to any candidate for public office in this election cycle or next, all Wall Street PACs be closed, and Wall Street lobbyists curtail their activities unless specifically asked for information by policymakers. Why should taxpayers finance Wall Street’s outsized political power – especially when that power is being exercised to get favorable terms from taxpayers?

4. Wall Street firms agree to comply with new regulations over disclosure, capital requirements, conflicts of interest, and market manipulation. The regulations will emerge in ninety days from a bi-partisan working group, to be convened immediately. After all, inadequate regulation and lack of oversight got us into this mess.

5. Wall Street agrees to give bankruptcy judges the authority to modify the terms of primary mortgages, so homeowners have a fighting chance to keep their homes. Why should distressed homeowners lose their homes when Wall Streeters receive taxpayer money that helps them keep their fancy ones?

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This Administration constantly threatens Congress with dire national consequences should Congress not enact the President’s exact agenda on his timetable. Nearly all of you have fallen for it time and time again. Not this time, please. Another recession is an inevitable part of the business cycles that come with a capitalistic economy. Accept that and be wise stewards of tax dollars by getting accountability from the firms that caused this mess.

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We need to try and stop this train. Why is it that people say you can’t just throw money at a problem and then CHEER when it’s $700B thrown at mismanaged Wall Street companies? Or $500B for an occupation for a country that doesn’t want it? No more.

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