Looking at the details in
this article, I am actually optimistic; not just about our economy, but about our future as a nation.
This legislation is a
true bipartisan effort. Both sides obviously had a give and take, and in my opinion, it is a deal with some important components that are good for all of us. Here is an excerpt:
The plan calls for the Treasury Department to buy deeply distressed mortgage-backed securities and other bad debts held by banks and other investors. The money should help troubled lenders make new loans and keep credit lines open. The government would later try to sell the discounted loan packages at the best possible price.
At the insistence of House Republicans, some money would be devoted to a program that would encourage holders of distressed mortgage-backed securities to keep them and buy government insurance to cover defaults.
The legislation would place limits on severance packages for executives of companies that benefit from the rescue plan, but details were sketchy.
Also, the government would receive stock warrants in return for the bailout relief, giving taxpayers a chance to share in financial companies' future profits.
To help struggling homeowners, the plan requires the government to try renegotiating the bad mortgages it acquires with the aim of lowering borrowers' monthly payments so they can keep their homes.
from
ForbesThe bailout, to be financed by government bonds, includes provisions to limit executive compensation for the firms that are being bailed out, an equity stake in those firms for taxpayers, an oversight board to account for the bailout process, and a measure to help prevent mortgage foreclosures. The $700 billion will be doled out in tranches of $250 billion immediately, $100 billion upon the approval of the president and $350 billion upon the approval of Congress.
Lawmakers also said there is language in the plan to allow the government to recover some of the money it is spending to buy troubled assets, as well as a provision that allows firms to buy insurance for toxic securities--something House Republicans had requested.
Credit will not dry up, so businesses who rely on this option to make payroll because they get paid at then end of projects will be able to stay afloat. The real estate market can get loans for people who are able to buy property. Homeowners facing foreclosure will have a good option to help keep them in their homes (helping de-escalate future crisis when these people default in addition to those already foreclosed on). Taxpayers will be able to share in future profits once values are stabilized/increased. If a company wants to keep the future profit, they have an option to keep the present bad debt with a government insurance plan, and executives will not be immune to the pain of their poor decision making on the job.
In my opinion, the best elements of both plans are included, and both parties are to be commended on working so hard to truly put the economy of the country before the nasty politics that could have paralyzed the country.
This is the kind of bi-partisan negotiation and cooperation that will be a hallmark of an Obama administration. Will the left always be happy? No. Will the right always be happy? No. Will we get shit done? Yes.