Is it possible, that after the huge bailout of wall streets irresponsible gambling away of billions, that, after the dust has settled and they again begin making a bit of profit, that these people will again start getting million dollar bonuses?
before this happens wouldn't it be better to wait until the debt to the taxpayer is paid off before these people are given bonuses just because the taxpayer has lifted their behinds out of the mud and given them new money to play with?
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Searching for Answers
Rep. Barney Frank on whether the government can afford any more bailouts and why he supports more regulation.
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Hard Times
Think the current economic crisis is bad? Before you decide, take a look at the bubbles, panics and depressions of the past.
Published Sep 18, 2008
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Compared to taxpayers, the American International Group (AIG), didn't have such a bad week. On the receiving end of an $85 billion bailout package, AIG executives now have new fuel to ensure the multinational lending giant can stay afloat in a turbulent market. But the Federal Exchange, funded by regular tax dollars, isn't as lucky. The latest bailout is the third in a series of rescue packages this year, so far totaling more than $200 billion in federal money.
The outlook for financial institutions—both commercial and investment ones—looks bleak, signaling that the problem could be far from over. Could taxpayers expect more federal-sponsored bailouts? How far could the problem extend? NEWSWEEK's Daniel Stone tried to ask Rep. Barney Frank, chairman of the House Financial Services Committee. Excerpts:
NEWSWEEK: This is the third bailout this year. What
'
s next?
Rep.
Barney Frank: I have no idea.
What kind of consideration goes into these massive funding packages?
With Fannie and Freddie, Congress was asked to give specific authority because of the federal involvement. But as to Bear Stearns and AIG, members of Congress were simply informed that these were decisions made by the Bush administration, specifically, Treasury Secretary Henry Paulson and Federal Reserve Chairman [Ben] Bernanke. I can't tell you what they were thinking.
Is there any thinking that members of Congress should have more of a say in this?
It's not up to us. Now, I have decided myself that this is not a good way to go. But you don't seem to want to accept the fact that neither of those two were Congressional decisions. They were decisions by the Bush administration, using authority that the Federal Reserve has from a statute passed in the '30s to lend money whenever they want to, when they think it's economically necessary, on whatever terms they want.
You think it should be different?
I would advocate an alternative form of intervention. That's what I'm going to be working on. I don't think it's healthy to have this kind of situation, even though I do admire [Fed Chairman Ben] Bernanke. But you're asking me questions to which I have no idea what the answer is.
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