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The Post Misleads Readers on the Bailout, Yet Again
Many school teachers, autoworkers, and plumbers do not like the idea of paying higher taxes so that the incompetent executives at major financial institutions can continue to collect their multi-million dollar paychecks. But, that is exactly what is happening as Congress voted tp "spread the wealth around" by redistributing tax dollars from ordinary workers to some of the very richest people in the county.
Yeah, we know about the limits on executive compensation. But these limits are a joke, that what all the experts said. People who read the Washington Post know that the limits on executive compensation are a joke because the Post ran a very good article (after the passage of the bailout) telling readers that the limits on compensation are a joke.
Since everyone knows that the limits on executive compensation are a joke, why did the Post tell readers in an article on the potential bailout of insurers that the banks who received government money "also must accept limits on executive compensation."
The reality is that these bailouts are being structured to be a massive transfer of wealth to the very richest people in the country. It is not supposed to be the media's job to conceal this fact from the public.
--Dean Baker
COMMENTS (20)
Considering that most of this wealth being redistributed came from taxes on the rich, the middle class should be less offended. Those that should be genuinely upset are the smart billionaires who are seeing their money go disproportionately to incompetents who don't deserve the capital they own. I guess the idiom "A fool and his money are soon parted" is less relevant in today's markets.
Posted by: Gordon Gekko | October 25, 2008 10:35 AM
. . . these bailouts are being structured to be a massive transfer of wealth . . . .
But what is "wealth" and how do we know it's being transferred and if it is, from whom to whom*?
* For all I know it's being transferred from Chinese peasants to little old retired ladies in Beardstown.
Posted by: Ellen1910 | October 25, 2008 11:08 AM
At the very least, since we taxpayers are stock owning investors in several of the country's largest banks, the compensation packages of the CEO's and senior executives ought to be made public. Doesn't the public have some right to know how their money is being spent?
Posted by: silverfox | October 25, 2008 11:18 AM
silver fox:
You hit it dead center. If it's our money, we should know how it's being spent. "Transparency" I think they call it.
There are several news items today noting that the purpose of the $700B keeps shifting. Why is that? Weren't we told the truth in the first place?
Posted by: Ethan | October 25, 2008 12:36 PM
So THAT's what McShame means by "share the wealth"!
Posted by: EconDumbo | October 25, 2008 3:47 PM
silverfox wrote, At the very least, since we taxpayers are stock owning investors in several of the country's largest banks...
Is that really true, though? My impression is that Treasury is getting preferred stock, not common stock. "We" are also getting warrants, but are we getting as many as "we've" paid for?
Posted by: liberal | October 26, 2008 11:58 AM
Gordon Gekko wrote, Considering that most of this wealth being redistributed came from taxes on the rich, the middle class should be less offended.
BS. The truly wealthy---and wealth is measuring by assets, not income---pay very little in tax.
I don't consider a doctor who works 65 hours per week and earns $300K/yr truly wealthy.
Posted by: liberal | October 26, 2008 12:00 PM
liberal
perhaps not, but that doctor could work 40 hours a week, and earn half that amount, and the health care "crisis" would begin to sort itself out.
if i had 300k a year i would no doubt have a different point of view, but meanwhile, what's driving the ills and evils of this country is the deeply felt sense of everyone, rich and poor, that they "deserve" more money.
Posted by: coberly | October 26, 2008 12:51 PM
@ Gordon Gekko & coberly:
What is in little dispute is that the Wall Street hustlers who caused this fiasco deserve not a dime of the taxpayer loot that they are now being given by a unelected appointed official with ties to the biggest heist organization on the Street. Why is this so hard for some people to grasp? The "reward" for the kind of incompetency, fraud, and stupidity we've witnessed on Wall Street should be insolvency and a massive cram-down, not a taxpayer giveaway to the very bastards who've destroyed the world's economy. Really, this ain't hard.
Posted by: Coldtype | October 26, 2008 2:04 PM
Coldtype
since i agree with you, i am not sure why you address your comment to me.
i am not a banker or an economist, but it seems to me that credit could be kept from freezing if the government just underwrote ordinary lending for the duration, while the Wall Street geniuses settled their own affairs.
Posted by: coberly | October 26, 2008 3:52 PM
@ coberly
My fault coberly, the Gekko response sent me into overload given all the crap I've been reading lately at other sites and in the mainstream generally. I do need to relax.
Posted by: Coldtype | October 26, 2008 5:16 PM
Coldtype
I know the feeling.
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On a different topic (earmarks), Greg Mankiw likes a political hit job by Paul Kane of the WaPo. Over at Angrybear, I try to learn from the master by taking earmarks in NY and Ill. relative to GSP. Consider this my Valentine's gift and maybe you'll cover Kane's piece tomorrow!
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