Monday, October 6, 2008

It Sure Ain't Your Grandpa's New Deal

Sorry for my lack of words for the last few days, since the VP debate. Preparations for the imminent arrival of baby are really starting to take up a lot of time, especially on the weekends.

So we now have a $700 billion bailout plan. What I'm not clear on is if that figure is inclusive of the $150 billion worth of "sweeteners" they added on to win over more members of the House or if what we really have is an $850 billion bill.

I'm so mad about this I can barely stand it. And not for the same reasons as the "fiscal conservative, free market" Republicans that voted against it. They think you should just leave the free market alone and let what happens, well, happen.

The problem with that mindset is that what just happened is what happens.

No, I hate this because it is nothing more than a big giveaway for the people who created this mess and does nothing to help the financial situation for most people in this country. The claims by politicians that the bill includes limits to executive pay is greatly exaggerated as nothing stops these companies form paying their CEOs huge salaries, just a limit to their severance packages.

We missed a great opportunity in this country to create a real economic recovery bill and we blew it. We could have done something to grow this economy from the ground up, as Obama likes to talk about but seems to not have any real proposals for such a thing. Like FDR rebuilt the economy during the Great Depression.

(I wonder if it will eventually become known as National Depression I, the same way that the Great War became World War I when there was another great war, after we finally admit that we will be in another depression just as big soon enough?)

We really had the chance to kill several birds with one stone by forming a new public works program. We already know that the infrastructure in this country is crumbling, or as I heard Rachel Maddow put it one time during the primary season, it is "made of sugar."

$700 billion could have gone a long way to fixing/replacing aging bridges, roads, fixing up our neglected national parks, building clean energy facilities like wind farms, fully funding and expanding Amtrak (including starting a real high-speed rail system), building new public transportation systems in cities without them as well as expanding and modernizing old ones in cities like New York, Boston, Philadelphia and Chicago.

We would have put people in the construction business to work almost immediately, one of the biggest needs right now with almost no new homes being built. So many more jobs would be created with all those people back to work and going out and spending their money in our economy.

This would help a lot of people, though not all, who are behind on their mortgages keep their houses. Combine that with something the feds should be doing, but the states have started to do themselves, forcing the banks to work out new lower mortgage rates for subprime borrowers.

Other primary benefits would be a modernized infrastructure that is not falling apart, cleaner energy sources and more transportation options in a time of higher gas prices and concerns about greenhouse gasses. All of these are things that we desperately need.

If we are going to add another $700 billion+ to our Chinese credit card, wouldn't this be a better use of that money?

I'm not delusional about the idea that this kind of bill would have actually gotten through a Congress with too many Republicans and a president who would have vetoed it and called it Socialism.

But I am disappointed that Obama didn't take the opportunity to call for something like this and instead supported the payoff to corporate America. We can't build the economy from the bottom up with just talk and no action.

And then there is John "as president I'll veto every pork-barrel spending bill that crosses my desk and I will make them famous" McCain, who had no problem voting yes on a bill that may actually be the most pork-laden one in history.

I'll be writing my next post, more than likely, about the dilemma, as a progressive, of whether or not to vote for Obama to expand on my statement of disappointment above.

I'm also planning on expounding on the issue of transportation soon, an issue near and dear to me and something I'm not hearing enough (or anything, really) about from any candidate. Stay tuned.


the beige one said...

I see where your disappointment stems from, but I also see how piping up would not have been politically expedient for Obama to do.

Not that it's a valid excuse, but I will tell you right now, I am more focused on getting the guy in office, simply because the alternative is that unpalatable.

Anonymous said...

that's what i'm thinking too...gotta go with the lesser of two political evils for now...get Obama into the white house and then join him in making the necessary changes.

the beige one said...

I don't even consider him an evil. Flawed, sure, but an evil?

Sorry, no.

sleepyjer said...

I too am frustrated about much of it. However, the fear about the CEO pay is that they will simply leave the company and go work for someone else outside of the financial world. As there are relatively few people to who know how to properly run a multi-billion dollar company, they will be able to find work even with the failure of their former business on their resumes.

Yes, they took awful risks with mortgages and in the credit default swap market, but do we want to replace them with people that may not be as qualified (because of the lower pay), at one of the most crucial times in Wall Street's history?

On a side note- I have found several resources that have helped me at least get a little understanding about what is going on in the fincancial world. NPR has been doing a podcast called "Planet Money" that has been doing shows every weekday for the last several weeks.

Also, This American Life has 2 full shows:
Episode 355 "The Giant Pool of Money" is about the mortgage crisis. I haven't listened to it yet but I've heard good things about it (it is This American Life, after all).

Episode 365 "Another Frightening Show About the Economy" is about how the sysem just about collapsed. This episode explains what Corporate paper, the averted money market fund collapse, credit default swaps and maybe more as I'm only 3/4 of the way through it. Fastenating and frightening (just like in the title!) at the same time.

Here's the link in I'm-not-so-geeky-that-I-know-this-HTML-crap format:

Anonymous said...

figure of speech...and i guess i'm referring more to the parties. of course he is not evil. anyway. i'm agreeing.

thanks for the extra resources sleepyjer.

the beige one said...

MOC, my apologies, absolutely not intended at you.

Anonymous said...

Bottom line is this: if you're Obama and you don't support the bailout, you commit political suicide. That's it. It's how the game is played. We may not like it, but that's what he had to do. Really think about not wasting your vote on a write-in, please Deni. We need you. Please understand the maneuvering that needs to take place in politics at this juncture. See you guys tomorrow night.