Bailout A Double Whammy for the Taxpayer

Posted: October 31, 2008 by kibler in bailout, CEO pay, Workplace Issues
Tags: , , , , , , , ,

What a mess! Not only is the economy crumbling around us, but the government bailout that was supposed to help homeowners stay in their homes, has become an unprecedented one-two punch that is taking the wind out of taxpayers.

 

No one wants to see the financial crisis worsen, but the idea behind a bailout was to help the people who were ending up in foreclosure or without a job because businesses couldn’t borrow even enough money to make their payrolls. Now it seems as if the bailout – which was railroaded through Congress – may not be designed to help those in real need at all.

 wallet of credit cards

Blogger Amey Stone (www.BloggingStocks.com) hit the nail on the head with her list of “Eight ways the Wall Street bailout is adding insult to injury”. According to Stone these are a few of the egregious ways that the companies benefiting from the bailout, keeping taxpayers from benefiting at all (heavily edited – see full text here):

 

·        Not only are Wall Street financial firms getting bailed out but they get to keep their big bonuses too. Estimates anticipate that as much as $70 billion (of the $700 billion bailout money) will get paid out in bonuses to bankers this year.

 

·        After getting an $85 billion bailout, AIG sent salespeople on a lavish retreat at the St. Regis resort in Monarch Beach, Calif. It cost AIG $440,000 but AIG execs should have put a stop to such unnecessary spending, not just because it was a potential public relations nightmare, but because it was the wrong thing to do for a company that could not make ends meet without burdening taxpayers.

 

·        Some Lehman executives got signing bonuses to stay at the banks that acquired their divisions in bankruptcy proceedings. Nomura, which bought Lehman’s European and Asian divisions, gave bankers cash equal to last year’s bonus if they agreed to stay at Nomura for a year, for example. Shouldn’t keeping their jobs have been compensation enough given the massive firings on Wall Street?

 

·        CEOs of failed financial firms still get a golden parachute to soften the blow. Even though their firms’ profits have been essentially wiped out, most will still be making millions at taxpayers’ expense. Five dollar bill

 

·        Banks that are sharing in the $700 billion bailout money are supposed to use it to keep the economy humming, right? Nope. It turns out that banks can use the money however they want. Banks that are getting government bailout money are contemplating using it for other things — like buying other banks — not adding it to the lending pool so they can make more loans and end the credit squeeze.

 

So, the question is: What can be done about this entire situation that has become a train wreck for every taxpayer?

 

Where does the greed and corruption stop? Who will be held accountable in government and at every corporation that now has its greedy hands out begging for more so they get their lavish trips, bonuses and golden parachutes?

Enough is enough!

 

As a taxpayer, are you fed up with this? Please, share your thoughts.

 

 

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Comments
  1. constituentresponse says:

    Americans need to stop being so naive about the nature of government — or business. They are living in a corporate state, why in the world should they expect fairness?

    There is no surprise in these corrupt companies using our Bailout tax dollars to pay for executive bonuses, junkets, and to buy each other out. No surprise at all. That’s what dishonest people do; what people not held accountable do. They’ve learned that most Americans won’t act to stop it. They’re not going to jail and they know it.

    So how do we start stopping it?

    We start by “un-electing” those Senators and Representatives who voted “yes” for the Bailout. They were willing to ignore the 90% of us who were against the Bailout, clearly demonstrating that they do NOT represent us.

    A new group called the Constituent Response Team has put together a Bailout Vote Map ( http://www.constituentresponse.com/congress ) that makes it easy (as a mouse click) to find out how your Senators and Representatives voted. Check it out — and then tell all your family and friends about it, so they can find out how their Representative and Senators voted before they cast their ballot on Tuesday.

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