Bailout and Stimulus: My Alternative Proposal; I Told You So…
by Ron Powell
Back in January, after the Senate voted to release the second $350 billion of TARP money, President Obama said that he was "gratified" he'd been given the authority to "maintain the flow of credit to families and businesses." Prior to that time I had composed and submitted the following article to several news organizations:
“In light of the inability or unwillingness of the Bush Administration and nearly all of the recipient financial institutions to account for the 350 billion dollars already distributed, and in keeping with (then) President-elect Obama’s assertions regarding changing the mindset as well as the behavior of those in Washington who would propose to solve our economic and financial problems, I am proposing an alternative to the 'bail-out' scenarios that seem to be the standard response to the financial difficulties that major corporations and financial institutions apparently have come to expect when their greed and/or incompetence, resulting in bad decisions and bad management, threatens their existence.
"It is, at times like this, critical to establish and pursue alternative modes of looking at and solving problems of this nature. Otherwise, all we can expect is more of the same from different sectors of the economy. If we are to break the cycle of failure and bail-out we must shut the door on the prospect of a direct government / taxpayer funded financial fix. My suggestion is to establish a national credit union with a portion of the remaining 350 billion now being requested. Membership and credit lines or limits could be linked to taxpayer status. Make credit available to those who require it on a no, low, or deferred interest basis. Repayment plans could be linked to federal withholding from paychecks or other similar arrangements. Give us the opportunity and option to seek home mortgage financing, auto loans, education loans, business loans and even credit cards from an entity that is directly responsible for the appropriate use and distribution of our tax dollars.
"The notion that the unavailability of credit will cripple and ultimately destroy the economy can be countered by making an alternative source of credit available and accessible to the people who are being asked to fund and underwrite this 'bail-out'. My suggestion may seem primitive or naive, but the operative term here is 'alternative'. If the difficulties and problems we are faced with are rooted, at least in part, in the drying up of credit in the marketplace, then we should take some of the 'bail-out' money and make credit available directly to taxpayers by creating a Federal Taxpayers Credit Union and stop giving our money to people who cannot and will not address the needs of the average citizen in a meaningful way.”
As much as I tried, I could not get any one to publish it.
Now, just over two months later, during his much discussed appearance on the Leno ‘Tonight Show‘, President Obama stated that we have to find other ways to "maintain the flow of credit to families and businesses" Obama told Leno and his viewers that his administration plans to "open up separate credit lines outside of banks for small businesses" and "set up a securitized market for student loans and auto loans outside of the banking system" in order to "get credit flowing again".
During the past two months I did not read or hear any commentary that reflected my views or ideas on the subject. None of the recognized op-ed writers or political pundits on TV were making comments or suggestions similar to the one I proposed, but I couldn’t get my simple proposal / comment published.
It is not very often that those of us who are passionate about writing to express our opinions or educate the public are able to claim that they got it right. However, in this case I believe that not only did I get it right in principle, but I got it right in terms of the mechanisms that may be used in bringing my ideas into being. Rarely does a writer derive any real satisfaction or gain a sense of pride in being able to express a great big “I told you so…”