Monday, November 30, 2009

Being for Main Street

Robert Reich, former Secretary of Labor, made three excellent suggestions on what to do for Main Street. He contends that Wall Street has no shame. While the people bailed them out to the sum of over $700 billion, they refuse to assist Americans who are underwater on their mortgages and lend to small businesses, instead setting aside multiple billions for executives and traders. Goldman Sachs set aside $17 billion and JP Morgan Chase around $5 billion.

To assist Main Street, Reich proposes the following:

Congress and the Obama administration should give homeowners the right to go to a bankruptcy judge and have their mortgages modified.

And while they're at it, resurrect the Glass-Steagall Act that used to separate investment from commercial banking, so Wall Street can't continue to use other people's money to gamble.

Finally, before Goldman hands out $17 billion in bonuses, claw back the $13 billion Goldman took from AIG and the rest of us and add it to the pool of money going for mortgage relief.
I would also like to see a real program that targets lending for small businesses during this crisis. Goldman has set "up a crudely conceived $500 million PR program to help Main Street." But a "PR program" is hardly one that will be most beneficial to small businesses, although I'm sure likely recipients would not turn it down. Small businesses are really hurting.

Might Reich's proposal work better in relief for Main Street?

4 comments:

septembermom said...

I think Reich's proposal does have potential. President Obama has always championed the small business owner. Hopefully, he can push the small business crisis to the front of the line for rejuvenation. Something needs to be done and quickly.

I think the mortgage modified request to a bankruptcy judge would also help many homeowners. It would give hope. That's always a good thing.

Judith Ellis said...

Kelly - I also think that this proposal has potential. But I don't think anyone's listening. Washington seems to have its own agenda paid and bought by lobbyists. I keep asking what are we going to do about it? We bailout out Wall Street but leave Main Street broke.

JOHN O'LEARY said...

Judith, I thought of you immediately when I read this WSJ article "No More Executive Bonuses." http://online.wsj.com/article_email/SB20001424052748703294004574511223494536570-lMyQjAyMDA5MDMwMDEzNDAyWj.html

"Eliminate bonuses. Period. Pay people, including the CEO, fairly. As an executive, if you want a bonus, buy the stock, like everyone else. Bet on your company for real, personally." Radical stuff, but....

Judith Ellis said...

Thanks for thinking of me, John. I check out the link for sure. I like the sounds of it. Of course, the naysayers will say that you can't tell private companies what to do. My thought is fine. Then, we'll regulate the hell out of you and not bail you out. Whatever works best for ALL concerned. I'll read the article and will probably have something to say about it. Thanks again.