The House and Senate approved this bipartisan financial package designed to stabilize credit and restore confidence in U.S. financial markets. This legislation is critical to allowing us to unclog the financial markets, free up credit to the average American and over time restore the American economy to what it has been and always will be - the best entrepreneurial capitalistic system in the world.
This is like the converse of a statement that Fidel Castro made a few years ago: "We are going to use capitalism to destroy capitalism." Now our idiot senators and representatives are telling us that they are going to destroy capitalism in order to save capitalism. Government owning 20% of the largest banks in the country is not "entrepreneurial" or "capitalistic."
While this legislation will not be a quick fix, it does address the core problem of mortgage-backed securities. As it is implemented, it will begin to stabilize the market and free up capital for the credit markets. The legislation authorizes the Treasury Secretary to immediately use up to $250 billion to purchase distressed assets from institutional investors.
Except we've already spent hundreds of billions, and not ONE MBS has been purchased yet.
If needed, the Secretary may then access an additional $100 billion to purchase these distressed assets but only with presidential approval. An additional $350 billion may be accessed if the president first wins approval from Congress.
The legislation includes a number of provisions to ensure oversight by Congress and accountability to the taxpayers, including prohibitions on executive compensation to ensure bad actors are not rewarded. Specifically, companies that receive more than $300 million from this plan will have limits placed on their top five executives. These limits include a ban from receiving a "golden parachute" as well as limits in the tax deductions executives may take on compensation over $500,000.
Who cares about the top five executives when everybody downstream of them is getting billions. At Goldman Sachs the average bonus is $216K, at Morgan Stanley it's $138K. You are taking MY money (I don't make $138K in total compensation, let alone bonus) and giving it to GS and MS employees. How dare you, you socialist? If I wanted a socialist to represent me, I would have voted for a socialist.
The legislation also continues the suspension of "mark-to-market" accounting rules that is already in place today. The bill does not allow bankruptcy judges to restructure the terms of existing mortgage loans. Additionally, it does not provide funds for affordable housing community organizers such as ACORN.This bill does precisely the one thing that we can do to help unlock the credit markets and help the average working Georgian, the average Georgia retiree, and the average Georgia child who is looking to the future to benefit from what right now is a very difficult situation. This financial crisis has cost people their jobs and put small businesses at risk. It has ransacked individual retirement accounts and frozen the credit available for businesses, home purchases and car purchases. The people affected by the legislation sent us to Washington to make these kinds of tough decisions. I am glad the majority of the members of Congress did not simply turn a blind eye and hope for the best.
Sincerely, Johnny Isakson
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