Shelby: Bailout plan ‘neither workable nor comprehensive’

By Jennifer J. Foster

Published: September 23, 2008

Alabama’s senior senator, U.S. Sen. Richard Shelby, is the ranking member of the Senate Banking Committee, the biggest hurdle the Bush Administration’s $700 billion financial services bailout plan will have to clear to become law.

Let’s just put it this way: He’s not a fan.

From Fox News:

“In my judgment, it would be foolish to waste massive sums of taxpayer funds testing an idea that has been hastily crafted and may actually cause the government to revert to an inadequate strategy of ad hoc bailouts,“ said Sen. Richard Shelby of Alabama, the top Republican on the Senate Banking Committee.

Vice President Dick Cheney has been dispatched to Capitol Hill to try to soothe the ruffled feathers of “seething” conservatives who are up in arms “about the ‘big government’ approach that they say President Bush is taking in the financial crisis. They don’t like how much power it cedes to the Treasury or the price tag,“ Fox News reported.

Lawmakers haven’t exactly rolled out the welcome mat. 

“[Cheney] is going to walk into a firing squad. I hope he brought his hunting rifle,“ one House conservative’s aide told FOX News.

Here’s what I want to know: Among all the potential “fixes” and tweaks being considered by lawmakers—a “pay-to-play fee” for institutions involved in the bailout; an on-budget item in annual appropriations bills, an exit strategy so companies won’t pin their losses on the Treasury, and a provision allowing judges to rewrite bankrupt homeowners’ mortgages so they could avoid foreclosure, according to Fox—why isn’t anyone proposing an eligibility requirement that would make these CEOs forfeit their $25, $30 million bonuses for their bankrupted firms to be part of the bailout?

Admittedly, the amount of the bonuses won’t right the financial companies. But it’s the least those companies should be required to do as a show of good faith with the American taxpayer, who is now left to clean up the mess left in the wake of their willful, reckless disregard for even the most elementary principles of responsible lending.

Actually, calling it “good faith” might be a bit euphemistic. Because requiring failed corporate CEOs to give up multi-million bonuses to be eligible for a government bailout program is really just asking them not to poke us in the eye while they steal our wallet.