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Merry Christmas to Bailout Recipients, Bah humbug to the rest of us

I don't know about you but I'm sick and tired of reading about the "bailout."  A day does not go by without being reminded how much those already loaded with cash and goodies receive yet another Christmas present from we the taxpayers.  I guess the proverbial "last straw" for me was the report by the Associated Press that asked 21 banks that had received at least $1 billion from the government four simple questions: "How much has been spent? What was it spent on? How much is being held in savings, and what's the plan for the rest?" ("Where'd the bailout money go? Shhhh, it's a secret," Matt Apuzzo, Associate Press, http://news.yahoo.com/s/ap/20081222/ap_on_bi_ge/meltdown_secrets).   None of the banks would answer these four questions.  That's right, none of them!! You would think that somebody in Congress or at the Treasury Department would demand some answers to the above questions.  A few had the gall to say things like "We're choosing not to disclose that," (Bank of New York Mellon, which got about $3 billion -- the spokesperson also said, apparently with a straight face, "I just would prefer if you wouldn't say that we're not going to discuss those details") or "We are going to decline to comment on your story" (Morgan Stanley) and "We're not sharing any other details. We're just not at this time" so said Wendy Walker, a spokeswoman for Dallas-based Comerica Inc., which received $2.25 billion from the government.) In other words, we got your (taxpayers) money and we don't owe you any explanation at all. What arrogance! I know of thousands of ordinary criminals who stole a lot less and were at least honest about it who are now serving long prison terms.  I wonder what they think about when they hear this kind of news. Concerning the roughly $350 billion yet to be handed out to these same kind of people, Treasury Secretary Henry Paulson said: "What we've been doing here is moving, I think, with lightning speed to put necessary programs in place, to develop them, implement them, and then we need to monitor them while we're doing this. So we're building this organization as we're going."  In other words, you don't have a specific plan in place and instead will do this on an ad hoc basis and worry about the details later. But it is good to know you are moving "with lightning speed"!! That's reassuring!   Think about all the times you have applied for a loan at your bank or credit union or any other institution and all the forms you had to fill out and all the personal questions you were asked.  As revealed on the Rachael Maddow Show (MSNBC) a few nights ago, the form these banks filled out to get taxpayer money was only two pages long! Elizabeth Warren, the congressional "watchdog" that is supposed to be overseeing the bailout had this to say: "It is entirely appropriate for the American people to know how their taxpayer dollars are being spent in private industry." Now that's probably the understatement of the year!!   Meanwhile, what about all those CEOs who have been taking a pay cut, with some getting a salary of just one dollar a year?  Don't worry about them, as they are still doing quite well.  For example according to Forbes, after getting a 38% pay raise in 2006, chief executives of the 500 biggest companies actually took a pay cut of 15% in 2007.  So they "only" earned a total of $6.4 billion in 2007, an average of $12.8 million apiece. (For a complete ranking of top CEO salaries in 2007 see this web site: http://www.forbes.com/lists/2008/12/lead_bestbosses08_CEO-Compensation_Rank.html.)

Of course we have all heard about the $1 annual salary taken by many CEO's and the cancelation of many bonuses.  Naturally none of them are suffering, as various stock options and other perks will keep them living in luxury for many years to come.  One example is Steve Jobs, who is the CEO of Apple Computer. He has already been collecting $1 in annual salary since 1997. But he is not hurting a bit, for he began 2008 with about 5.5 million shares of Apple stock and a net worth of about $6 billion (Sam Pizzigati, "The 10 Greediest People of 2008," Alter Net, December 23, 2008, http://www.alternet.org/story/114782/the_10_greediest_people_of_2008/?page=entire). One example is a man named Steve Jobs, CEO of Apple Computers, has taken just $1 in annual salary since 1997, but he was given a $90 million Gulfstream V jet in 1999 and pay him for the cost of operating it; in 2007 that was $776,000

Then we have the group known as the "Culprits of the Financial Crisis" as reported by Ian Cooper of the Baltimore Investing Examiner on December 18, 2008 (http://www.examiner.com/x-1760-Baltimore-Investing-Examiner~y2008m12d18-Culprits-of-the-Financial-Crisis). Among the worst include:

·         Angelo Mozilo - Former Countrywide Financial CEO (they financed about 1/5 of all mortgages in the U.S. and they went bankrupt but Mozilo walked away with more than $200 million;

·         James Cayne - Former CEO, Bear Stearns (after the collapse of this institution, he walked away with about $61 million)

·         Dick Fuld and Erin Callan -- respectively CEO and CFO of Lehman Brothers (both took off with more than $1 billion in bonuses before the firm collapsed)

·         Martin Sullivan - CEO, AIG (walked away from this mess with more than $20 million)

There are more, but this is enough to convince you that all these folks are having a nice Christmas, while the rest of us struggle to make ends meet. Mind you, I haven't even mentioned one of the biggest crooks of the year, Bernie Madoff and his "Ponzi" scheme and the estimated $50 billion he stole from investors! At the very least, let's make sure the prosecutions that have already begun against some of these crooks go forward and they are forced to pay huge fines, to be used for some good around the country.

Maybe it would be a good idea for a massive protest movement, including millions of people marching into those banks that received our money and demanding some of our money back.  Let's see, that's $350 billion divided by 300 million people in America or about $1,167 for each person.  Suppose we include only taxpayers and there are about 138 million of us.  That's $350 billion divided by 138 million or $2,536 each. That's not as much as some of the above referenced CEOs but it is a start.  Or perhaps needy taxpayers should get a mortgage that is interest-free for the first five years and then only about 5% thereafter.  While they are handing out so much money, what about the remaining $350 billion still to come?  Let's really "spread the wealth"!  Spend enough to end poverty in this country. Give every homeless person a place to live, including the estimated 200,000 homeless veterans. Stop all foreclosures and evictions immediately by handing over enough money to cover these expenses.  Use some of the money to create jobs for the estimated 600,000 prisoners who will return to society within the next year. How about funding more alternatives to the failed juvenile institutions and adult prisons?  How about that $90 million jet that Steve Jobs owns and the $776,000 yearly operating costs? How many poor children around the world could be fed each day for that money?  Or perhaps Apple could get rid of the jet and use the money to supply computers to children in the poorest schools.

 As a new web site states: "It's time for a "People's Bailout" that fixes the real economy, restores a voice for working people in challenging corporate greed, provides emergency help to the victims of the crisis and begins building a fair economy that works for all" (http://www.jwj.org/bailout/index.html).  While we are at it, let's give the families of every soldier in the Middle East a big Christmas present and send the troops home, thereby saving lives and billions of dollars! 

Keywords: best practices, federal, Randall Shelden

Posted in Blog, Political Landscape

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