Allow me to present you with a passage from the proposed financial bailout bill called the Troubled Asset Relief Program, or TARP, presented to Congress by the Bush Administration.
‘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.’
This single sentence is formally referred to as Section Eight of the proposed bailout plan. Considering that the entire proposal, which asks for the power to purchase $700 billion in bad mortgage assets to ‘rescue’ the American financial system is only three pages in length, the fact that the passage discussing one of the most significant and potentially enduring aspects of the proposal consists of a mere 32 words is not surprising.’
What is surprising is the affronting boldness of the proposal. The original TARP language seeks to bestow the Treasury secretary with unprecedented powers to oversee the economic and financial well-being of the country. Financial Patriot Act anyone?
Just in case you’re still struggling to grasp the gravity of this situation, this proposed bill would give extraordinary powers to the government to maintain our financial markets without any oversight or accountability so they could try to fix this monumental financial crisis. A crisis that was caused by the very same lack of accountability and oversight by these same individuals. This ‘solution’ reeks of hypocrisy.
TARP also states, ‘The Secretary is authorized to take such actions as the Secretary deems necessary to carry out the authorities in this act without regard to any other provision of law regarding public contracts.’
In laymen’s terms, the American people should entrust a single government agency and ultimately a single individual with protecting their future fiscal prosperity by giving them carte blanche. Uh, I think not.
Wait.’ Allow me to practice saying okay. ‘Yes, Secretary Paulson’mdash;Mr. ex-Goldman Sachs CEO’mdash;I would love to give you incredible authority without any accountability. Please create a rescue package meant to protect corporate interests.’ Nope, that doesn’t feel right. It is insincere.
Aside from the lack of oversight provided by this proposal, there is nothing in the bill to prevent this crisis from occurring again. Instead, it merely prevents the economy from hitting bottom by placing it a bit further up the same slippery slope.
What is more, taxpayer dollars will be used to deal with this crisis. That money shouldn’t be used to reward reckless Wall Street executives who led us to this end. Congress, in considering this bill, must negotiate a reimbursement plan for taxpayers and insist on assistance for homeowners who are confronting foreclosure. The stunning amount of taxpayer funds needed for this bailout plan requires bipartisan oversight and regulation to guarantee financial transparency and accountability.
Section three of the TARP proposal discusses considerations, or the relevant factors in assessing the economic situation.
The proposal states, ‘In exercising the authorities granted in this Act, the Secretary shall take into consideration means for’-(1) providing stability or preventing disruption to the financial markets or banking system; and (2) protecting the taxpayer.’
Perhaps it is my unyielding cynicism, or my lack of economic intellect, but there appears to be something inherently wrong with a rescue plan that in order to operate requires taxpayer funds that in turn places those very taxpayers second on the list of considerations.
While I am not qualified to offer a resolution to this crisis, I do feel confident in my ability to speak reasonably about what appears to be a potentially dangerous situation. Rushing to a decision about this proposed bill, as the Bush Administration would have Congress do, could potentially exacerbate our financial predicament for years to come.
The proposed bill, in its original form, is like placing a Band-Aid on cancer. To truly improve the American economy and by default prevent further damage to the world economy, Americans must organize a new financial system as well as a new economic and social outlook.