10.05.2008

EMERGENCY ECONOMIC STABILIZATION Act

[From the U.S. Government Printing Office via GPO Access]
[DOCID: h1424eas.txt]
[Engrossed Amendment Senate]


               In the Senate of the United States,

                    October 1 (legislative day, September 17), 2008.
 Resolved, That the bill from the House of Representatives (H.R.
1424) entitled ``An Act to amend section 712 of the Employee Retirement
Income Security Act of 1974, section 2705 of the Public Health Service
Act, section 9812 of the Internal Revenue Code of 1986 to require
equity in the provision of mental health and substance-related disorder
benefits under group health plans, to prohibit discrimination on the
basis of genetic information with respect to health insurance and
employment, and for other purposes.'', do pass with the following

                           AMENDMENTS:

         Strike all after the enacting clause and insert the
   following:

           DIVISION A--EMERGENCY ECONOMIC STABILIZATION

SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.

 (a) Short Title.--This division may be cited as the ``Emergency
Economic Stabilization Act of 2008''.
 (b) Table of Contents.--The table of contents for this division is
as follows:

Sec. 1. Short title and table of contents.
Sec. 2. Purposes.
Sec. 3. Definitions.

             TITLE I--TROUBLED ASSETS RELIEF PROGRAM

Sec. 101. Purchases of troubled assets.
Sec. 102. Insurance of troubled assets.
Sec. 103. Considerations.
Sec. 104. Financial Stability Oversight Board.
Sec. 105. Reports.
Sec. 106. Rights; management; sale of troubled assets; revenues and
                         sale proceeds.
Sec. 107. Contracting procedures.
Sec. 108. Conflicts of interest.
Sec. 109. Foreclosure mitigation efforts.
Sec. 110. Assistance to homeowners.
Sec. 111. Executive compensation and corporate governance.
Sec. 112. Coordination with foreign authorities and central banks.
Sec. 113. Minimization of long-term costs and maximization of benefits
                         for taxpayers.
Sec. 114. Market transparency.
Sec. 115. Graduated authorization to purchase.
Sec. 116. Oversight and audits.
Sec. 117. Study and report on margin authority.
Sec. 118. Funding.
Sec. 119. Judicial review and related matters.
Sec. 120. Termination of authority.
Sec. 121. Special Inspector General for the Troubled Asset Relief
                         Program.
Sec. 122. Increase in statutory limit on the public debt.
Sec. 123. Credit reform.
Sec. 124. HOPE for Homeowners amendments.
Sec. 125. Congressional Oversight Panel.
Sec. 126. FDIC authority.
Sec. 127. Cooperation with the FBI.
Sec. 128. Acceleration of effective date.
Sec. 129. Disclosures on exercise of loan authority.
Sec. 130. Technical corrections.
Sec. 131. Exchange Stabilization Fund reimbursement.
Sec. 132. Authority to suspend mark-to-market accounting.
Sec. 133. Study on mark-to-market accounting.
Sec. 134. Recoupment.
Sec. 135. Preservation of authority.
Sec. 136. Temporary increase in deposit and share insurance coverage.

               TITLE II--BUDGET-RELATED PROVISIONS

Sec. 201. Information for congressional support agencies.
Sec. 202. Reports by the Office of Management and Budget and the
                         Congressional Budget Office.
Sec. 203. Analysis in President's Budget.
Sec. 204. Emergency treatment.

                    TITLE III--TAX PROVISIONS

Sec. 301. Gain or loss from sale or exchange of certain preferred
                         stock.
Sec. 302. Special rules for tax treatment of executive compensation of
                         employers participating in the troubled
                         assets relief program.
Sec. 303. Extension of exclusion of income from discharge of qualified
                         principal residence indebtedness.

SEC. 2. PURPOSES.

 The purposes of this Act are--
         (1) to immediately provide authority and facilities that
     the Secretary of the Treasury can use to restore liquidity and
     stability to the financial system of the United States; and
         (2) to ensure that such authority and such facilities are
     used in a manner that--
                 (A) protects home values, college funds, retirement
             accounts, and life savings;
                 (B) preserves homeownership and promotes jobs and
             economic growth;
                 (C) maximizes overall returns to the taxpayers of
             the United States; and
                 (D) provides public accountability for the exercise
             of such authority.
[Continue  Reading]

posted by Jeseppi Trade Wildfeather at 11:13 AM 0 comments

Do the Math on the Bailout and Paulson

My fellow Americans ... These are changing times and those who lack understanding of freedom and liberty will soon become wise.

Review the new Paulson Regimme.

posted by Jeseppi Trade Wildfeather at 7:44 AM 0 comments

Henry Paulson Requests Non-Reviewable Authority To Dole Out Billions Terry Trippany

[Tyranny is here: Another excellent article;]

on Sep 22 2008 at 11:30 am | Filed under: Feature Article, Politicians at Work

Michelle Malkin looks back in time tracking Henry Paluson’s troubling record leading up to one of the worst financial disasters in U.S. history.

Henry Paulson is a former managing partner and COO at Goldman Sachs with a current net worth estimated at $700 million dollars. If you don’t think he has a financial stake in the current financial crisis that could conflict with his ability to do what is right for the American taxpayer then you are reading the wrong website.

He, along with fed chair Ben Bernanke and SEC Chair Christopher Cox are at the helm of the government’s move to nationalize the nations largest financial institutions; a move that puts this country one large step closer to the likes of Hugo Chavez.

Now Paulson wants the government to give him the keys to over $700 BILLION dollars and is requesting that this be done under authority that “may not be reviewed by any court of law or any administrative agency.”

This reckless, unelected friend of Wall Street has been wrong on the severity of the subprime mortgage crisis repeatedly and now he is requesting that the American taxpayer trust him with nearly a trillion dollars in a power grab that is not subject to any scrutiny or review.

Let’s review Paulson’s keen insights and see if this man should be fired or given the keys to the country.

First we loo at the proposal as submitted September 19, 2008, Text Draft Proposal of Legislative Bailout Plan

Sec. 2. Purchases of Mortgage-Related Assets.

(a) Authority to Purchase.–The Secretary is authorized to purchase, and to make and fund commitments to purchase, on such terms and conditions as determined by the Secretary, mortgage-related assets from any financial institution having its headquarters in the United States.

(b) Necessary Actions.–The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this Act, including, without limitation:

(1) appointing such employees as may be required to carry out the authorities in this Act and defining their duties;

(2) entering into contracts, including contracts for services authorized by section 3109 of title 5, United States Code, without regard to any other provision of law regarding public contracts;

(3) designating financial institutions as financial agents of the Government, and they shall perform all such reasonable duties related to this Act as financial agents of the Government as may be required of them;

(4) establishing vehicles that are authorized, subject to supervision by the Secretary, to purchase mortgage-related assets and issue obligations; and

(5) issuing such regulations and other guidance as may be necessary or appropriate to define terms or carry out the authorities of this Act.

There is a lot of language in this legislative proposal like the above. Tying it all together is the provision concerning review of those “investments”, “contracts” and “employment decisions”.

Sec. 8. Review.

Decisions by the Secretary pursuant to the authority of this Act are non-reviewable and committed to agency discretion, and may not be reviewed by any court of law or any administrative agency.

With this proposal in mind we now turn our attention to a list of statements made by Paulson leading up to the crisis. While reading this you should ask yourselves if this guy should be the one bailing this country out of the mess that he, many more in Congress and his friends in Wall Street helped create?

Paulson, April 2007:

“I don’t see (subprime mortgage market troubles) imposing a serious problem. I think it’s going to be largely contained”.

Paulson, May 2007

That correction was inevitable; that correction has now been significant. We think it is near the bottom. It will take a while to work its way through the system. Fortunately for us, we have a very diverse, healthy economy. There are other things that are positive that are offsetting that.

…So my very strong view is that we are near the bottom and that this will be contained as — the housing will be contained, and we’re fortunate that we have a diverse, healthy economy.

Paulson, August 2007 while on a trip to Beijing

There’s a wake-up call, and there’s an adjustment to this repricing of risk, but I see the underlying economy as being very healthy,” he told reporters before leaving Beijing.

Paulson added that he did not see anything that caused him to reconsider his view that the economic damage from the housing correction was “largely contained,” despite losses in a number of financial institutions and a long period for subprime issues to move through the economy.

Paulson, October 2007 Speech at Georgetown University

Treasury Secretary Hank Paulson is walking a fine line, pushing the need to help troubled mortgage borrowers without rewarding past risky behavior.

“I have no interest in bailing out lenders or property speculators.”

Paulson, May 2008

‘The worst is likely to be behind us,’ Paulson told the paper, in one of the most optimistic comments by a top U.S. finance official since sub-prime mortgage losses set a domino effect in motion in mid 2007.

So either Paulson has been lying to the American people ever since he knew that the train was heading down the tracks or he is stupid. I don’t think he is stupid but you can make your own conclusions. Bottom line, Americans should not be giving this guy any unfettered access to our money. Enough is enough.

Read the whole story on Malkin, there is much much more to this crisis of corruption, greed and the power brokers in Congress that were every bit as complicit in this disaster as the ones that were enabled to bleed these insititutions into bankruptcy.

posted by Jeseppi Trade Wildfeather at 7:42 AM 0 comments

Financial Tyranny, Fedzilla-style by Ted Nugent

[Excellent post in "An Angry Mob of One"]

(First, props to by Ted Nugent for the term “Fedzilla”)

According to Webster’s. tyranny may be defined as 2(a) a government in which absolute power is vested in a single ruler; one characteristic of an ancient Greek city-state; (b) the office, authority, and administration of a tyrant.

In the instance of Bush’s proposed bailout, the shoe fits- it is tyranny of the highest order.

According to the proposal, the Feds will basically be able to do as they will (emphasis mine):

Treasury Seeks Asset-Buying Power Unchecked by Courts (Update2)
By Alison Fitzgerald and John Brinsley

Sept. 21 (Bloomberg) — The Bush administration sought unchecked power from Congress to buy $700 billion in bad mortgage investments from financial companies in what would be an unprecedented government intrusion into the markets.

Through his plan, Treasury Secretary Henry Paulson aims to avert a credit freeze that would bring the financial system and the world’s largest economy to a standstill. The bill would prevent courts from reviewing actions taken under its authority.

“He’s asking for a huge amount of power,” said Nouriel Roubini, an economist at New York University. “He’s saying, `Trust me, I’m going to do it right if you give me absolute control.’ This is not a monarchy.”

As congressional aides and officials scrutinized the proposal, the Treasury late yesterday clarified the types of assets it would purchase. Paulson would have authority to buy home loans, mortgage-backed securities, commercial mortgage- related assets and, after consultation with the Federal Reserve chairman, “other assets, as deemed necessary to effectively stabilize financial markets,” the Treasury said in a statement.

The Treasury would also have discretion, after discussions with the Fed, to make non-U.S. financial institutions eligible under the program.

The plan would raise the ceiling on the national debt and spend as much as the combined annual budgets of the Departments of Defense, Education and Health and Human Services. Paulson is asking for the power to hire asset managers and award contracts to private companies. Most provisions of the proposal expire after two years from the date of enactment.

(Read the rest at Bloomberg.com)

It’s all bad, but two things stand out as particularly troubling:

“Other assets.” What exactly does this mean? Is there anything in the proposal that would safeguard US taxpayers from Paulson using this vague and undefined term to buy anything he desires? It seems that, acting in cahoots with the Federal Reserve, all he would have to do is say, for example, that the steel industry is causing turmoil in financial markets, and the government could buy their assets.
“The bill would prevent courts from reviewing actions taken under its authority.” This means the US taxpayer would have no legal recourse to challenge anything Paulson decided to do. According to the provisions of the plan, if Paulson decided to bail out a foreign bank, no citizen could sue to stop it.

Does this qualify as tyranny? Well, Paulson would have virtually unchecked authority to act- meaning he would have absolute power. By definition, this is tyranny- and your congressmen and Senators are lining up to support the plan.

Things will get only worse under either Obama or McCain, as both are champions of both Fedzilla and the Federal Reserve, and would do nothing to reign them in (or, in the case of the FR, get rid of it). A vote for either of them is a vote for tyranny.

posted by Jeseppi Trade Wildfeather at 7:24 AM 0 comments

Progressives Starting To Demand An Alternative To Paulson's Boneheaded Proposal & Corporate Giveaways

[This is an excellent blog review from

http://downwithtyranny.blogspot.com/2008/09/progressives-starting-to-demand.html:]

Although he has a somewhat different approach than the good folks at BuyMyShitPile.com, Paul Krugman has an eye-opening column in today's NY Times called Cash For Trash. He gives voice to the uncomfortable notion floating around the zeitgeist that calls "the proposed legislation the Authorization for Use of Financial Force, after the Authorization for Use of Military Force, the infamous bill that gave the Bush administration the green light to invade Iraq."

Paulson is demanding extraordinary power for himself-- and for his successor-- to deploy taxpayers’ money on behalf of a plan that, as far as I can see, doesn’t make sense.

Some are saying that we should simply trust Mr. Paulson, because he’s a smart guy who knows what he’s doing. But that’s only half true: he is a smart guy, but what, exactly, in the experience of the past year and a half-- a period during which Mr. Paulson repeatedly declared the financial crisis “contained,” and then offered a series of unsuccessful fixes-- justifies the belief that he knows what he’s doing? He’s making it up as he goes along, just like the rest of us.

So let’s try to think this through for ourselves. I have a four-step view of the financial crisis:

1. The bursting of the housing bubble has led to a surge in defaults and foreclosures, which in turn has led to a plunge in the prices of mortgage-backed securities-- assets whose value ultimately comes from mortgage payments.

2. These financial losses have left many financial institutions with too little capital-- too few assets compared with their debt. This problem is especially severe because everyone took on so much debt during the bubble years.

3. Because financial institutions have too little capital relative to their debt, they haven’t been able or willing to provide the credit the economy needs.

4. Financial institutions have been trying to pay down their debt by selling assets, including those mortgage-backed securities, but this drives asset prices down and makes their financial position even worse. This vicious circle is what some call the “paradox of deleveraging.”

...Paulson insists that he wants a “clean” plan. “Clean,” in this context, means a taxpayer-financed bailout with no strings attached-- no quid pro quo on the part of those being bailed out. Why is that a good thing? Add to this the fact that Mr. Paulson is also demanding dictatorial authority, plus immunity from review “by any court of law or any administrative agency,” and this adds up to an unacceptable proposal.

I’m aware that Congress is under enormous pressure to agree to the Paulson plan in the next few days, with at most a few modifications that make it slightly less bad. Basically, after having spent a year and a half telling everyone that things were under control, the Bush administration says that the sky is falling, and that to save the world we have to do exactly what it says now now now.

But I’d urge Congress to pause for a minute, take a deep breath, and try to seriously rework the structure of the plan, making it a plan that addresses the real problem. Don’t let yourself be railroaded-- if this plan goes through in anything like its current form, we’ll all be very sorry in the not-too-distant future.

This weekend Democrats Blue America backs strongly, Congresswoman Hilda Solis (D-CA) and candidate Annette Taddeo (D-FL), both big supporters of small businesses and working families, have been campaigning together in Miami-Dade and talking with voters about the bailout. Hilda is a member of the Energy and Commerce Committee and she has been instrumental in making sure Annette understands exactly where the congressional debate has been going and why a progressive alternative to Paulson's proposals is needed. Annette:

“We are in a state of crisis. Taxpayers will have to spend $700 billion or more to pay for the refusal of President Bush and rubberstamps like Ileana Ros-Lehtinen to conduct oversight or accountability. We need to protect American families and small businesses. For too long, George Bush and Ros-Lehtinen have sided with the special interests, and the American people are left paying the bill.”

She is an advocate of cutting taxes for small businesses and the middle class and bringing the power balance between corporate America and the rest of us back into pre-Bush Regime equilibrium. “We must cut taxes for the middle class so that they have real relief. We must expand health care for children, so that parents who are increasingly being squeezed don’t have to choose between paying the rent and buying medicines. We must end the war in, Iraq where we are spending over $400 million a day. We must have real oversight over Wall Street so that this does not happen again. And since this crisis began with too many unsustainable mortgages, any resolution must include a plan to ease pressure on homeowners.”

Hilda is one of the good guys in Congress who we will be counting on to stand up against the corporate shills like Steny Hoyer, Rahm Emanuel and Melissa Bean who are pressuring Democrats to sign on to the Bush Regime proposals, like they did when he wanted to invade Iraq and just like they did when he decided to shred the Constitution with his FISA bill. In her joint statement with Annette, Hilda reminded Floridians that "Three years ago, President Bush and rubberstamps in Congress like Ileana Ros-Lehtinen fought hard to privatize Social Security. From the floor of Congress, Ros-Lehtinen said that she “applauded the President for his strong leadership and vision” and that she wanted to “reform Social Security to include private accounts. Had George W. Bush and rubberstamps in Congress had their way, today’s financial crisis would be a full-blown emergency. Tens of millions of seniors around the country, including hundreds of thousands here in South Florida, would have lost their pensions overnight.”

Annette followed up with a statement going right to the heart of the Bush Regime's flawed approach.

We will not be forced into acting on a $700 billion bill without even examining what the bill does. The American people need protection so that this emergency does not turn into a boondogive-away to corporate insiders. Congress should send President Bush a bill that includes transaction standards, independent oversight, protections for homeowners, and constraints on excessive executive compensation.

The bill is inadequate because while doing nothing for homeowners, it gives the Treasury Department a blank check for Wall Street-– it authorizes purchases “on such terms and conditions as determined by the [Administration].” There would be no guidelines, no standards, no conditions. The Treasury would be permitted to purchase assets at any price it wanted, even if it provided a huge profit to the same corporate entities that got us into this mess in the first place, entities like commercial banks, investment banking firms-– even hedge funds-- that have acted recklessly or worse.

I oppose, and call on Ileana Ros-Lehtinen to oppose-- the Bush Administration’s proposed legislation giving the Treasury the power to spend up to $700 billion to buy “mortgage-related assets” from U.S.-based financial institutions, until the proposed bill is strengthened to protect homeowners, and to protect the American taxpayer from sweetheart deals, cronyism and outright waste.

Finally, if the bailout is to be expanded to cover foreign-headquartered companies, then our allies must share the burden. Unfortunately, after seven and a half years of Cowboy diplomacy and a war in Iraq based on lies, we have little if any leverage left with our allies. They have no desire and little incentive to help us in our moment of need. It is time for a new beginning.

Debbie Cook is another Blue America-endorsed candidate who Hilda has been helping-- this time to beat Bush rubber stamp and lunatic fringe extremist Dana Rohrabacher here in southern California. Debbie, who is the mayor of Huntington Beach and very much in touch with the mundane problems the Bush Economic Miracle have brought into the lives of real people, was the very first Democratic candidate to e-mail us on Friday night when Paulson's proposal started leaking out:

"We must take action to keep our whole economy from collapsing. But if the plan by the Treasury which has leaked out today is genuine, then it's unclear if the plan will work at all.

"Add in a massive transfer of authority to the executive branch, with no congressional oversight or judicial review, and this plan should be dead on arrival.

"Handing over taxpayer money to the government with no oversight is always a bad idea and it's especially rotten given the current administration's track record."

.
Meanwhile, up in Oregon, Speaker of the House and Democratic Senate candidate Jeff Merkley is demanding that Gordon Smith represent Oregon citizens for a change-- and not his corporate backers who have financed his political career in return for his constant help with their special interests. He is insisting that Smith reject Paulson's proposal. This morning he demanded that Smith reject the blank check proposal that needs to be fixed so it includes "protections for homeowners, limits on executive compensation and market reforms to prevent a future crisis. " As Jeff points out, Smith's lockstep support for deregulation-- the 1999 Phil Gramm legislation that removed restrictions on the activities of banks, investment firms and insurance companies and allowed the proliferation of new and unregulated banking practices was instrumental in causing this crisis.

"Republicans in Washington are demanding a blank check to fix the mess they created and that is completely unacceptable. Real families are hurting in this economy and George Bush is only concerned about CEOs on Wall Street. Gordon Smith rubber-stamped the Bush policies that led to this mess, and I urge him to reject any blank check that puts special interests on Wall Street ahead of families on Main Street.... Gordon Smith says, 'don't play the blame game'-- what he really means is 'don't hold me accountable'. Oregonians need new leadership in Washington and that starts with rejecting the failed policies and philosophies of Gordon Smith and the Republican party in November. In the meantime, Smith must stop giving blank checks to the Bush Administration-- he did it with the Iraq war, and he shouldn't do it now."

posted by Jeseppi Trade Wildfeather at 7:18 AM 0 comments

10.03.2008

The Bailout's Essential Brazenness by Jay Cochran

Dr. Cochran is an Adjunct Professor of Economics at George Mason University.

Added to cato.org on October 1, 2008

This article appeared on Cato.org on October 1, 2008

One of the more galling arguments put forth in support of the Treasury’s $700 billion bailout, is the suggestion that the government might actually profit from being a hold-tomaturity investor in the illiquid mortgage instruments currently clogging the arteries of high finance. Laying aside the thorny issue of whether the Treasury Secretary and his overseers have the means to discover the correct price for securities that the market itself cannot price (hence the illiquidity), it is breathtakingly brazen that the supporters of this scheme think it somehow proper for the government to earn even one basis point of net return from a problem that is of its own making.

Congress and the executive branch, established the rules and institutions that all but guaranteed the outcome we taxpayers see unfolding and are being asked to pay for today. Government leaders had multiple opportunities to correct problems identified years before, but instead dithered and calculated. To suggest now-in malice, greed, or fear-that it is somehow proper for government to make a net return on the assets it purchases, is as unjust as allowing a referee to make money gambling on the outcome of a game he oversees. (Read on)

posted by Jeseppi Trade Wildfeather at 6:09 AM 0 comments

10.05.2008

EMERGENCY ECONOMIC STABILIZATION Act

Do the Math on the Bailout and Paulson

Henry Paulson Requests Non-Reviewable Authority To Dole Out Billions Terry Trippany

Financial Tyranny, Fedzilla-style by Ted Nugent

(First, props to by Ted Nugent for the term “Fedzilla”)

Progressives Starting To Demand An Alternative To Paulson's Boneheaded Proposal & Corporate Giveaways

[This is an excellent blog review from

http://downwithtyranny.blogspot.com/2008/09/progressives-starting-to-demand.html:]

10.03.2008

The Bailout's Essential Brazenness by Jay Cochran

Dr. Cochran is an Adjunct Professor of Economics at George Mason University.

CLICKING HEAD BANNERS IN EACH AREA WILL RETURN YOU TO THE SITE MAP.
Total Madness: General Selected Writings by Various Authors.

Previous Posts

Archives

CLICKING HEAD BANNERS IN EACH AREA WILL RETURN YOU TO THE SITE MAP. Total Madness: General Selected Writings by Various Authors.

10.05.2008

EMERGENCY ECONOMIC STABILIZATION Act

Do the Math on the Bailout and Paulson

Henry Paulson Requests Non-Reviewable Authority To Dole Out Billions Terry Trippany

Financial Tyranny, Fedzilla-style by Ted Nugent

(First, props to by Ted Nugent for the term “Fedzilla”)

Progressives Starting To Demand An Alternative To Paulson's Boneheaded Proposal & Corporate Giveaways

[This is an excellent blog review from

http://downwithtyranny.blogspot.com/2008/09/progressives-starting-to-demand.html:]

10.03.2008

The Bailout's Essential Brazenness by Jay Cochran

Dr. Cochran is an Adjunct Professor of Economics at George Mason University.

Previous Posts

Archives

CLICKING HEAD BANNERS IN EACH AREA WILL RETURN YOU TO THE SITE MAP.
Total Madness: General Selected Writings by Various Authors.