Support DeFazio's No Bailouts Plan

  • Bob Fertik's picture
    Bob Fertik
    Want to meet our members? Click 'Join' above!

On Tuesday, Rep. Pete DeFazio (D-OR) and other members of the Progressive Caucus introduced the "No Bailouts Plan" as an alternative to Paulson's Plunder. DeFazio's bill:

  1. Stabilizes the financial markets without writing a blank check to the big banks and CEOs who got us into this mess.
  2. Limits future losses by banks without asking taxpayers to pick up the tab. By suspending the application of fair value accounting standards by financial institutions, the bill will limit bank's artificial write-downs on the value of their mortgage-related and other securities.
  3. Protects against predatory financial behavior by enacting permanent regulations against short-selling. By requiring the SEC permanently to block short-selling and restore the "up-tick rule" that blocks short-selling in a down market, the bill will protect against predatory financial behavior that harms investor confidence and hurts the ability of banks and other companies to raise needed capital.
  4. Loans capital to banks that need it, with taxpayers making money on interest when the banks pay off the loans. By creating a Net Worth Certificate Program to allow the FDIC to lend short term capital to failing banks with the promise of repayment with interest, the bill replicates a successful program that worked to stabilize banks from 1982 to 1993. Banks that participate in the program must submit to strict oversight of their executives' compensation.
  5. Restores consumer and small business confidence in banks. By requiring the FDIC to raise its insurance limit on costumers' deposits from $100,000 to $250,000, the bill assures consumers and small businesses their money is safe and helps eliminate runs on banks that threaten the stability of the financial markets.

Ian Welsh writes:

There are currently two bills being worked on in the House as alternatives to the Paulson-Obama bill.  The first is the DeFazio bill, which is intended to fix the banking system by providing, not a bailout, but insolvency relief.  The second is being put together by Rep. David Scott and Rep. Doggett, with the aid of economist James K. Galbraith, and is intended to help ordinary people by creating a modern version of the Home Owner's Loan Corporation (HOLC) to take over mortgages and keep people in their homes with reasonable serviceable mortgages. 

Also working to turn these bills into something that helps all Americans are Rep. Elijah Cummings and Rep. Lloyd Doggett.

Each bill by itself is incomplete, together with some work they could make a good, complete, humane solution to financial and economic meltdown which is also acceptable to enough Republicans to pass.

In my opinion, the Paulson bill won't solve the problem, but will only push it back 6 months or so, at great cost to ordinary taxpayers.  If the Paulson bill isn't defeated we're going to be back here again, a lot poorer, trying to do this right. 

What I would ask is that if you are opposed to the Paulson bill, you pick up the phone and tell your Rep that you are still opposed and it's still a bad idea.  And while you're on the call please ask them to join with Doggett, Scott, DeFazio, Cummings and Edwards in crafting the House's own bill as an alternative. 

For more analysis of DeFazio's bill, read these blogs:

Something Progressive as The Alternative
Jerome Armstrong - MyDD
http://www.mydd.com/story/2008/9/30/202558/971

SEIU Endorses Defazio and Edwards Rescue Plan
Matt Stoller - OpenLeft.com
http://openleft.com/showDiary.do?diaryId=8706

Better Democrats Doing Their Thing
digby - Hullabaloo
http://digbysblog.blogspot.com/2008/09/better-democrats-doing-their-thing-by.html

Anxious Industries Hungry For Bailout, As Labor Backs Dem Alternative
On the Hill Blog
http://onthehillblog.blogspot.com/2008/09/anxious-industries-hungry-for-bailout.html

Donna Edwards, Elijah Cummings cosponsor alternative bailout bill
Free State Politics
http://www.freestatepolitics.us/showDiary.do?diaryId=1785

STRATEGY MEMO: Turning a Wall Street Giveaway Into an Economic Rescue for
All Americans
David Sirota - Our Future.org
http://www.ourfuture.org/blog-entry/2008094030/strategy-memo-turning-wall-street-giveaway-economic-rescue-all-americans

 

Early Thoughts on the DeFazio Bill
Ian Welsh - FireDogLake
http://firedoglake.com/2008/09/30/early-thoughts-on-the-defazio-bill/

The No BAILOUT Bill, and Our Strategy Moving Forward
David Sirota - OpenLeft.com
http://openleft.com/showDiary.do?diaryId=8713

A Third Bush Dog Vote?
Chris Bowers - OpenLeft.com
http://openleft.com/showDiary.do?diaryId=8712

House Progressives Propose Bailout Alternative
Christopher Hayes - The Nation
http://www.thenation.com/blogs/jstreet/366574/house_progressives_propose_bailout_alternative

No BAILOUTS Act
Ari - Oxdown Gazette, FireDogLake
http://oxdown.firedoglake.com/diary/328

Bailout alternative offered by House Dems
Chicago Tribune
http://www.swamppolitics.com/news/politics/blog/2008/09/bailout_alternative_offered_ho.html

The Alternative "No Bailout" DeFazio Plan
SusanG - DailyKos
http://www.dailykos.com/storyonly/2008/9/30/18155/2039

3 Maryland Representatives Draft Bailout Alternatives
Southern Maryland Online
http://somd.com/news/headlines/2008/8423.shtml

 

Comments

DeFazio and Kaptur

  • davidswanson's picture
    davidswanson
    Want to meet our members? Click 'Join' above!

These two sound so

  • j-jour's picture
    j-jour
    Want to meet our members? Click 'Join' above!

These two sound so reasonable!!! It is such a change...

Thanks. Hope they can be listened to.

Peter DeFazio and Kucinich - Get behind them!

  • Christian Soldier's picture
    Christian Soldier
    Want to meet our members? Click 'Join' above!

The question before us as Americans is whether we want to slide off the cliff into the abyss of a never ending Corporatist/Fascist State or get the guts to stop these pigs before they complete this coup!

Of course we need a bottom up solution - How can Americans swallow the idea that predatory lending practices, devoid of usury laws of any kind, to enrich men in pursuit of the mother of all Ponzi schemes, should be given their ill gotten gain when the scam fails?

Are we that dumb? Are we insane?

The rescue should be to save homes and the people who inhabit them from foreclosure. The rest should be to arrest and jail the scum who created this nightmare!

DeFazio, Kucinich, and Sen. Bernie Sanders - It's about all we have.

You wanna see other dems get behind this? Just tell them your voting Nadar this November and let's see what the reaction is!

Fear is being used.

  • Ole's picture
    Ole
    Want to meet our members? Click 'Join' above!

Fear is being used to try to sway the people. I do hope the people can keep resisting and keep call there reps to say NO!

Congress ignores the mandate of the majority's "Do Not Act"

  • rhytonen's picture
    rhytonen
    Want to meet our members? Click 'Join' above!

We called, we emailed, all through the discussions and votes. Everyone knows an overwehelming historic majority of the citizens, congress' employers, contacted them personally and clearly demanded what they should do - and they completely and brazenly ignored us. Their own colleagues offered obviously better solutions to try - and they ignored them too. All they had to do fo rnmow was just say no - to something that, (watch what happens next...) will NOT save the credit crunch and downward spiral except as much as the banks let trickle out, to encourage continued release of the Billion$ into feeding frenzy reach.

Should this not be abuse of power at least, in a democratic system, if not treason?
That this control and milking of the people doesn;t sufficiently anger politicians to act (or rather, not act to pay their demands,) should tell you a great deakl - in fact should tell you almost eveything. A read of the historical relationship between government and the banks will tell you the rest. I would urge all citizens to read it, but be prepared - you will have to act and it won't be fun.

How can we get rid of each and every criminal in government who supported this lie, that there was a legitimate (not manufactured) credit crunch? And that would have to start with the lie's greatest proponent - Barack Obama, the man I was ready to vote for!
And incidentally, the party I intended to support, was also mostly responsible for this outrageous bill. Needless to say I would now vote for Jane Fonda if she were running against Obama and the Dems. I'm not sure I have as much converted to being a Republican, for they're even worse - but I am more determined either to find a party I can support who will support me, or I will vote simply on spite. That is no worse a reason than whatever corrupting influence caused congress to vote against America.
And the damage is done - far, far worse damage is now assured, in coming months and years, than even the Bush Republicans have done and will do.

Who would not know with certainty (not just guess or suspect,) that if an already proven corrupt business (Investment Banking here and in China)controls credit, and stands to gain such enormous available plunder as that (BTW uncappped) $700B, they would certainly stage a credit crunch by cutting it off to the lower level banks?

I'm only beginning to understand the truly evil and corrupt connection between congress and the banking system, but it appears to be the oldest and most dangerous running atrocity and abuse of power in history. Remember the biggest of the "big banks" they keep blaming belongs to (or rather is attached to...like a sucker fish...) the government (or rather and even more interesting, Congress.)

And yes, if congress truly couldn't figure that out, that level of stupidity disqualifies them to govern as much as collusion, disobedience of the majority's wishes, and treason. I have to wonder what was the price of their souls and all the misery they have heaped on the American citizens. Every ill they cited as due to the staged credit crisis, they have cause a hundredfold by their willful misbehavior.
I hope most of you know the Andrew Jackson quote, circulating on the web, on the Reserve Bank. This is perfectly described there.

Just go to show...

  • Ole's picture
    Ole
    Want to meet our members? Click 'Join' above!

It just goes to show that the 2 party system doesn't work or maybe anyone earning more than 100,000.00 dollars a year should not be allowed to be in government.
Maybe the lobbyists should all be thrown out of capital hill. It does make my blood boil. The worst thing about this horrendous bill is no oversight and no regulation.
what the f**k.

There are not two parties.

  • Jim's picture
    Jim
    Want to meet our members? Click 'Join' above!

There are tons of them.

There is however 51% consensus which creates the change we need.

QUESTION: Tell us how one gets to that dirty, compromised, work riddled place?

Presently, the Democratic Party could use an elbowing out of about 20% of its members in order to create that 51% liberal consensus for continual change.

QUESTION: If you try to build that 51% consensus in another way, by for example starting with a 1-2% consensus, how are you going to stop compromise, big money, etc. from infiltrating that consensus? (As happens when that consensus has the name "Democratic Party")

It's easy to act as if someone "out there" is doing wrong and one is simply judging a sport's team, quit another to try and build that consensus as others are actively infiltrating, abandoning ship, driving corrupting cash into, etc.

Jim

Can I offer an alternative explanation to what you're feeling?

  • Jim's picture
    Jim
    Want to meet our members? Click 'Join' above!

Ole,

Might you not simply be cursing the world for being so damned unruly? That is completely understandable and, I think, a more productive way to think about the break down in 51% consensus ;)

In addition, to abandon a large, but crude liberal consensus for change, in order to begin again, is EXACTLY the plan of those that want it fractured: the Right. Better instead to recognize the formidable task one has, and attempt to carve out only the bad.

Jim

Jim I understand your point.

  • Ole's picture
    Ole
    Want to meet our members? Click 'Join' above!

Great I like it how does one go about the 51% consensus. It does seem when you are in a more conservative state that the only dems that can be elected are blue dog aka bush democrats. nominating a more progressive liberal democrat will probably put a republican in that seat.
There does seem to be alot of venom in here for independents. I thought this was a forum for open ideas as long as people are not mean spirited or rude about it. I still plan to vote for Barack Obama.
I blame the corporate media for demonizing liberals since Reagan was president.

It's tough...

  • Jim's picture
    Jim
    Want to meet our members? Click 'Join' above!

...getting we humans to agree ;)

As an example :D I'll offer a different take on "venom": Many methods are being used to corral consensus including inclusion, shame, ridicule, a platform for posting especially if one identifies as a "Democrat", etc. So "venom" may be an accurate assessment, at times, but it should be seen in context.

Now how is that for being a nuanced Liberal? Seeing "a punch in the eye socket" as a means to persuade "consensus" ;)

I don't think there is only one method, nor is this a clean process. SADLY! If I knew the perfect balance I would implement it every time even if it meant giving out back scratches! (Ok that quickly becomes an odd image but you get my point:)

Best regards,

Jim

P.S. You should see my tough love when Right Wingers stop by...

Ole, it's not so much

  • Bill Harding's picture
    Bill Harding
    Want to meet our members? Click 'Join' above!

Ole, it's not so much "venom" for "Independents," as it is frustration with them. The real venom is reserved for "centrist" faux-Democrats, and the DLC.

"Independents," as a group, stand for nothing (except individualism), have no organized agenda, no spokesperson(s), and delude themselves into thinking that they have somehow "dropped out," and are above the fray. Unfortunately (for them) we have a representative form of government in which majority-rule applies. Political, middle-of-the-road, individualism does not count for much under such a "yes or no" system.

There are both Conservative Republican and Democratic voters, and Liberal Republican and Democratic voters, while some are squarely in the Middle. To take a hands-off, "may-the-better-man/woman-win," regardless of Party affiliation approach, is to be apathetic.

As I've said before, although not legally spelled out anywhere, the American political system has evolved into a de facto two-Party system, and the joint Congress (where Laws are made) reflects that. An "Independent" has absolutely no chance of winning the Oval Office in today's political climate, so all Third-Party candidates are nothing more than spoilers, while those who vote for them mistakenly believe that they are somehow "making a statement."

In reality, you can only make a difference when you work from within the framework of an active participating political Party. You cannot change the system, unless you attempt to bring about change from within your own sphere of influence first. "Independents" and Greens have no effective, or focused, "sphere of influence," and their only weapon is threatening to withhold their vote -- which helps no one.

"Independents" and Greens are NOT a part of the solution, and only dilute the efforts of those who are trying to bring about realistic change from the bottom up. I believe that this desire for change applies to both mainstream political Parties at the grassroots level, but more so to Democrats, and we need all of the help we can muster.

As I said before.

  • Ole's picture
    Ole
    Want to meet our members? Click 'Join' above!

To call people ineffectual just because they choose not to join a specific party is basically saying there vote is worthless.
I thought every vote counts. Regardless of which party or affiliation.

Note: Offensive comment removed by Moderator.

Hi Ole.

  • Jim's picture
    Jim
    Want to meet our members? Click 'Join' above!

This is again the perspective of the spectator, isn't it?

Something to think about:

I have no problem if someone does not believe in the consensus I am trying to achieve under the Democratic Label. Maybe I'm remiss in not repeating that often enough, though I have stated it. Folks DO, at times, fundamentally disagree and that is AOK! ;) Another party, or no party, might then suit one better and arguments to persuade that particular kind of voter ARE different.

I am speaking however of a mass of voters who do NOT fundamentally disagree with the consensus the majority of Democrats aim for. I am speaking of folks who have run from the label for other reasons:

  • Right Wing talk radio so bashing folks that the "Independent" label is easier to live with around water cooler discussions at work.
  • Frustration with gaining 51% consensus blurring logic so that the baby is thrown out with the bathwater and the label Green is worn instead of Democrat. (i.e. shedding ties with that 40% greenish Democratic perspective because of the infiltration by Faux Democrats skewing the Party).
  • etc.

Listen, somehow you and I have to get a hundred million people to agree :(

Now if we dedicate ourselves to that task, then we can never simply point to players in the game. The board is ours. We are not attempting to define the best path. We are not attempting to create change. WE are attempting to define the best path AND move in that direction.

If the Greens succeeded they would have a big Party with all the problems of the Democratic one, and the only difference now would be folks would be splintering from the Greens because of all the same arguments!!! A rose by any other name...

Jim

Thinking about DeFazio's

  • j-jour's picture
    j-jour
    Want to meet our members? Click 'Join' above!

Thinking about DeFazio's Nobailout plan after watching his invigorating 5 minutes'speech "who believes George Bush?" in Congress, I was wondering about the internal organisation of the Democratic party:
Has such a sensible proposition, endorsed by SEIU, ever had a chance of being "internally" examined and discussed by Obama's Headquarter?
( please excuse me if my questions sometimes happen to sound extravagant, I ask them from a "foreign" point of view, sometimes unaware of certain aspects everyone of you may regard obvious).