APAs and the Bailout
October 1, 2008
Asian Pacific Americans in the House of Representatives were split on the Wall Street bailout bill as it went down in defeat on Monday. Supporting the bill were California Democrats Doris Matsui and Mike Honda. Opposing it were Mazie Hirono (D-HI), Bobby Scott (D-Va.) and David Wu (D-Ore.). Madeleine Bordallo (D-Guam) and Eni Faleomavaega (D-Samoa), as non-voting Delegates, can vote in House committees but do not have votes on the House floor.
APA Senators Daniel Inouye and Daniel Akaka from Hawai‘i were scheduled to vote on a modified version of the bill in the Senate on Wednesday evening as this story went to press.
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This urgent campaign to bail out Wall Street is reminiscent of this administration’s lies about drastic consequences if we did not go to war with Iraq. Five years later, we know that the administration lied to the American people and are stuck in an Iraqi civil war, paying $10 billion per month with no end in sight. For this reason, while most economists agree that there is a need to take action on the current economic situation, the majority of Americans are skeptical of President Bush and Treasury Secretary Hank Paulson when they call for urgent action with little or no review.
Rep. Mike Honda, as a vice chair of the Democratic National Committee, and Rep. Doris Matsui, who is close to Speaker Pelosi and the Democratic Party leadership, both have strong pro-consumer reputations. In the case of this bailout bill, however, they decided to join the Democratic Party leadership and some Republicans in voting for the bill, despite its bestowing what Speaker Pelosi referred to as “Tsar-like powers” on the Secretary of the Treasury and allowing for minimal oversight. Like many commentators and economists, they decided that passing the bill represented less of a threat to taxpayers than possibly allowing the economy to founder if the bill were allowed to go down to defeat.
Representatives Scott, Wu and Hirono, on the other hand, joined 95 Democrats and 133 Republicans who voted “no” on the Bush-Paulson bill. Reasons for opposing the bill varied, with some decrying too much state intervention and some saying it provided too much intervention with too little oversight and payback for the taxpayer.
Nothing in the Bush-Paulson plan addressed deeper problems with income inequality, job losses, deteriorating housing values and fundamental flaws in our healthcare system (which is the cause of many bankruptcies and housing foreclosures when people with inadequate health insurance cannot pay their bills after a major illness).
In the aftermath of the Bush-Paulson bill’s defeat, Representatives Scott and Hirono signed onto a bill, developed by Rep. Pete DeFazio (D-Ore.) and the Congressional Progressive Caucus, that also has the support of Rep. Marcy Kaptur (D-Ohio), Rep. Neil Abercrombie (D-HI), Rep. Elijah Cummings (D-Md.), Rep. Lloyd Doggett (D-Texas), Rep. Rush Holt (D-NJ) and Rep. Donna Edwards (D-Md.).
Instead of using $700 billion in American taxpayer monies to purchase toxic assets from Wall Street dealers in a plan some have dubbed “cash for trash,” the plan backed by Hirono and Scott offers five steps to re-regulate the markets and move beyond a quick fix to the immediate liquidity crisis.
These steps include increasing the Federal Deposit Insurance Corporation’s (FDIC) insurance amount on deposits from $100,000 to $250,000; suspending so-called “mark-to-market” accounting rules (thus enabling banks to more realistically state the value of assets over time rather than at current value); and reviving the Net Worth Certificate Program, used from 1982 to 1993 (which authorized the FDIC to issue certificates that banks could carry as capital on their balance sheets).
Other steps include requiring the Securities and Exchange Commission to tightly restrict short-selling and resurrecting a security transfer tax, rescinded in 1966, that would raise an estimated $150 billion per year (at a rate of 0.25 percent per transaction).
“Most of these actions can be taken at little or no cost to the taxpayer,” said Rep. Abercrombie.
The two-million-member SEIU (Service Employees International Union) is among the groups supporting the Progressive Caucus bill, called the “No BAILOUTS Act” (Bringing Accountability, Increased Liquidity, Oversight, and Upholding Taxpayer Security).
Based on the recent failure of “free market” capitalism and the potential for widening damage to the United States economy in the weeks and months ahead, the federal public works programs, banking regulations and social security programs implemented during the 1930s to address the Great Depression deserve re-examination. In the meantime, however, new laws such as those backed by some of our APA Members of Congress to bring oversight, transparency and social responsibility to Wall Street are a good first step.
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2 Responses to “APAs and the Bailout”
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I don’t think there is anyone on Capitol Hill except Ron Paul and Dennis Kucinich that understands the monetary system.
Google and Watch “Money as Debt”. The cause of the current money crisis is not due to “free market” economy it is the result of a government granted banking monopoly to issue our money as debt.
Because the 12 private Federal Reserve Banks have amonopoly to create “legal tender” not lawful money as debt. We have had an explosion of debt.
Most Americans do not no that all money other than coin is create out of thin air by the banks as debt. The money to pay the interest is never created. When principal on the loan is repaid the money is destroyed and no longer exists. This process causes inflation as more money is needded each year to pay last years intrest. This also create growing debt. The main problem comes because the debt grows faster than the money due to the magic of compound interest.
We now have over $1.3 quardrillion in derivatives. These gambling debts are coming due. The total world GDP is only $60 trillion. So this humongous house of cards is impossible to sustain and is now in collapse.
Please go to my website and read the various articles on money and derivatives. peterjames08.com
The solution to our crisis is to abolish the Federal Reserve and issue all our money out of the Treasury. This produces zero public debt and saves us trillions of dollars on debt.
Folks:
Sans the smarts to digest Peter Jameses’ thoughts immediately preceding, this perch also KNOWS that the operative culprit here is USURY.
England used to put debtors in prison. We just keep ‘em in hock.
Until that unlikely day when EVERYone gets an honest day’s wage for an honest day’s work, nothing much can or will change.
Meanwhile, the House of Representatives MUST be held hostage to the public outrage over this corporate heist dubbed “bailout.”
Doris Matsui should remember that her late and honored mate was a fine legislator, but lacked the independence and courage to stand up for what he really believed?
The least she could do is VOTE for the people and NOT for the fat cats and oligarchs and warmongers.
Today, online, Michael Moore and colleagues laid out a 10-point alternative that makes sense AND dollars FOR the people and the nation.
I hope all hands on deck read same, especially Obama’s “advisors” and handlers.
It’s PAST time to disarm the bandits. Tell them to take their FEAR and put it where the sun can’t shine.
And, APA friends and foes, remember that what hurts your neighbor can shortly visit you, and that what helps him or her can in no way hurt you.
We are all human first, citizens second, and conjoined, whether or not we like the condition.
So belay the divisions and the divided hopes and fears.
The “enemy” here are the Greedsters, Inc. on Wall Street and their self-aggrandiziing pimps in the Beltway, whatever their “party” affiliation.
Frank Eng
P.S.: Keep calling your Congresspersons. I would but for the fact I can’t hear the recorded responses.