Given what is going on in the financial world, I wanted to comment, as I believe all of us as taxpayers, let alone business owners, need to actively participate in this conversion before we all get stuck with something that could cause us problems for years to come.
So, for what it is worth, here are my thoughts on the bailout. Firstly, I believe it is necessary. There are a number of good, free market, Darwinesque arguments against it, but, on balance, I believe that it should be passed for the greater good of both the US, and the world, economy. This, however, should only happen provided certain stringent conditions are attached. These are below:
1 - Tax payer equity ownership in the companies bailed out. Ie, we all become stock owners in the companies that are rescued under the plan. This to me is basic free market common sense investing, as it means that we will all benefit over the coming 5 - 15 years as these companies recover and prosper.
2 - Independent regulation and oversight. As has been seen time and again, the idea of any industry "self regulating" is ludicrous, because they simply don't do it. So, independent, bi-partisan regulation group, here we come.
3 - Golden parachute / income caps. Obviously those senior execs departing the company should not be allowed to walk away with million dollar severance packages. However, we do need to reward the incoming execs in such a way as to make them work as hard as possible to make our new companies (provided #1 has occurred) profitable. To me this looks like reasonable salaries plus highly lucrative deferred stock options - the kind they can't exercise for 5 plus years (I have no problem with someone earning $20 million if they have turned a bankrupt company into one generate billions a year... I just have a problem with the ones who bankrupted it earning that).
4 - Mortgage relief for homeowners. Some kind of system needs to be put in place to help people stay in their homes (such as lowering their monthly payments but extending the length of the mortgage), as the trickle down effect of mass evictions / re-possessions cannot be calculated (plus, from the banks perspective, better to have some money coming in than a house sitting empty and unsold over the long term). However, I do not agree with extending this philosophy to regular consumer debt (cars, credit cards etc) - that's what debt plans are for.
So, like I say, my opinions, for what they are worth. I present them not because I am in any way an expert, but because, as I stated earlier, I believe this is a discussion and decision that will effect us all for decades to come, and we all need to take responsibility for getting our voices heard. I would welcome any thoughts or comments, and await the final plan with baited breath.
Miata Edoga is a working actor and founder of Abundance Bound, Inc, the financial education company for actors and artists. Click Prosperity for a FREE CD download and special report “51 Ways To Achieve Prosperity”.
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