October 3rd, 2008
04:43 PM ET

Bailout should treat the root cause, not the symptoms

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/10/03/bailout.jackson..jpg caption="The House of Representatives has passed historic legislation to bail out the troubled financial industry. "]

Rep. Jesse L. Jackson Jr.
(D) Illinois

To borrow the title of a classic modern novel, "Things Fall Apart." In just decades, Americans have gone from Franklin Delano Roosevelt's New Deal to George W. Bush's Rash Deal.

During the last few days, my office has been flooded with phone calls from citizens throughout the country, expressing outrage and indignation.

To many, there's something awry, perhaps even unseemly, about this hasty plan. It requires the government - which is running up huge deficits and record-breaking debt - to borrow and spend the funds of ordinary Americans - who are falling further behind and into poverty - to rescue superrich bankers and barons - whose obscene excess and avarice have helped to create the financial mess.

It's Robin Hood in reverse, taking from the needy to give to the greedy.

In one colorful description, the Bush administration's unprecedented $700 billion bailout plan was characterized as "cash for trash." It takes private industries' troubled assets off their books and dumps them into the public's lap, further privatizing profits and socializing losses. In doing so, the plan's proponents argued, cash and credit would once again flow, with benefits trickling down and the economy turning up.

But, from the outset, the proposal was seriously flawed.


Filed under: Economy • Raw Politics
soundoff (15 Responses)
  1. Annie Kate

    "Taking from the needy to give to the greedy" – pretty good there. I viewed the bailout more as a stop the bleeding measure before the needy are out of a job. I believe the bailout will help the needy not get worse off because of the actions of the greedy. At least I sure hope so.

    Annie Kate
    Birmingham AL

    October 3, 2008 at 9:52 pm |
  2. Susan

    I think it is time for CNN to take a little responsibility when reporting the days events.... You are always pointing out the fact that both political parties will only draw attention to points that benefit them and often in doing so they do not really tell you the whole truth...

    I point this out because all evening I have sat here while CNN has reported that the house and the senate has passed the bail out bill and attached all the pork to it, and how irresponsible they have to been in doing so....

    I will say this right now, I do not agree with the bail out and I really do not believe the it will work. I do not feel that in passing this bill either party was not trying to look out for the American people.... But in saying that I do feel that the public should know that pork was not added to the bail out... It was in fact the other way around... The pork bill had already been passed by the house... The senate in order to get the ball rolling and get the bail out passed, attached it as an amendment to the pork bill... And in doing so forced the house to pass the bill...

    So in your reporting I do believe you need to explain this to the people.

    October 3, 2008 at 8:43 pm |
  3. larry

    Why do you ignore the 1999 plot by POTUS Bill Clinton, Barack Obama and ACORN to force banks into giving mortgages to people who would otherwise not have been accepted. Then Fanny Mae, along with Barney Frank and his cohort that was working there became responsible for those bad mortgages.
    This crisis did not begin with he bush43 administration, it goes back further and is a stain on our political system.

    Where is the courage of conviction in Congress? You are supposed to be representing WE THE PEOPLE, not 'we the politicians that talk out of both sides of our mouths while crossing our fingers behind your backs'

    I don't care what the party is, you are ALL responsible to US. We are the American people.

    October 3, 2008 at 8:01 pm |
  4. Joe Ayala

    OH MY GOSH! people don't be fooled by this so call bailout or rescue of $700 billion plus. how does a plan inflates to over 450 pages from the original 3 pages? the plan now calls for over $850 billion dollars and where did the extra $150 billion dollars comes from? that's something that neither side would probably wont mention, at least not now but in about a month or so or maybe after the elections.

    this so call bailout will not fix the current problem. it's just a band-aid at best. in about 3 or 4 years we will be right back where it started..... ground zero, wall street.

    this "so call" bailout package won't help those companies right away, it will be at least 3 to 4 months down the road. and then those same companies will back to the same way of doing business (making bad decisions/judgements).

    there was no economy collapse if this package didn't pass. Paulson, hoodwinked everyone in congress into passing this bailout plan.

    what did paulson get in return? what say you?
    some rum tastes better then others.... s a v v y.

    October 3, 2008 at 7:48 pm |
  5. Daryl

    Wall Street is being bailed out. Now what about Main Street? Is there
    any help on the way for the homeowner that, due to the economy, is now in danger of not being able to pay his mortgage??
    How can this situation get some attention?

    October 3, 2008 at 7:46 pm |
  6. Camille

    Of all the talk about how this crisis affects THE MAIN ST, people have not addressed what this means for people who are already struggling, already unemployed. Are the job losses a result of this growing problem or is the consistent downward spiral fall of the middle class now affecting the fat cats on wall street?

    Just now all the comments about our financial crisis are about loans. What about decreased credit limits to those who are using them as life lines?

    What does Main St. look like? When I look out at my Main St, people are'nt even trying to address loans, people are trying to pay rents and scrape by on low wages.

    October 3, 2008 at 6:34 pm |

    First, wall street street needed to be rescued, now we hear that California ia going to ask for Federal Money as they can not get a loan to pay their bills.
    How about they send the people from other countries, here illegally, back to where they came from, then maybe they could pay their bills.
    The schools have courses for people from many countries, how can anyone keep up if someone doesn't step up and say NO MORE, we can't afford to keep you. Go home for schooling, medical treatment, jobs etc then try and come back legally when you can fend for yourself, and know the English Language.
    When does all this end??????

    October 3, 2008 at 6:19 pm |
  8. Ron Olson

    Wow now after saving the country congress needs a vacation! The only better job to have is CEO of Washington Mutual. So they did there work for the year and now they are going to take the rest of the year off. There is more work to do they got us into this mess by playing partisan politics.

    If we are lucky maybe most of them will not be reelected.

    Score Congress 700 Billion Americans 0

    October 3, 2008 at 6:13 pm |
  9. Ron Olson

    My expectations of congress regardless of party affiliation is to work together to find common ground to end the gridlock and stop pointing fingers at each other and get the job done. I am looking for a proactive government not a reactive government be part of the solution not part of the problem
    Wasn’t much to go on, I am looking at you to lead someone that can will work to eliminate partisan politics and keep congress focused on their job I have 700 billion reasons

    October 3, 2008 at 6:12 pm |
  10. D. A. Reuter, Bremerton, WA

    I think that the POTUS and Congress should read and understand the Preamble to the Constution:

    "We the People of the United States, in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity, do ordain and establish this Constitution for the United States of America."

    They have not done their collective jobs, if they did, we would not be in the situation that we are in. Can" We The People" sue POTUS and Congress for malpractice and cite them for contempt of Constitution of the United States of America?

    October 3, 2008 at 5:49 pm |
  11. Joy in Seattle

    It's been a long time since I agreed with Jesse Jackson on anything – but I sure do agree with him on this one. Our government has jumped into a rash decision which is simply more of the exact same type of thing that got us into this mess in the first place. Most of us on Main Street across America do not want this deal because we just don't trust the people who were managing it in the first place to fix it.

    The entire reason we are in the Nation wide credit crisis is because we – as a whole – borrow more than we can afford. This includes everyone from the small town to the big business to the banks that lend more than they can handle to the US government itself. Now, the solution they've posed to this entire credit crisis is to borrow more money and make more deficit.

    All this "bailout" did was postpone the crisis to another day.

    October 3, 2008 at 5:47 pm |
  12. Mike in NYC

    Moderators, please do your jobs. This article was about Wall Street, the bailout, and foreclosed homeowners. Yet J from DC's obnoxiously long post addressed none of these, and read like an Obama/Biden campaign talking points memo.

    This is not an issue of rich v. poor - living beyond one's means is the essence of modern America. As for rescuing distressed homeowners, some are truly victims of circumstance, but many are not. Understanding a mortgage contract is not that difficult for someone with a functioning cerebrum. If you can’t, then owning a home is not for you. Sad but true. It's also a fact that home prices need to come down. Jackson's prescriptions will keep them propped up. Unfortunately, many "innocent" people will suffer along with the "guilty" when the inevitable, but necessary, corrections occur. The piper's got to be paid, sooner or later.

    October 3, 2008 at 5:46 pm |
  13. Strykyng

    Insider-trading, anti-trust, coersion, bribery....The 200+ who voted this travestity in ,despite voters objections, should be prosecuted. Who or what, made you smarter than 90% of the rest of us. Oh yeah....Self interest and the smell of Pork. Im sure you have reserved your seat in Hades.

    October 3, 2008 at 5:36 pm |
  14. Nancy

    I would like for the media to publish whcih congressmen introduced the pork that was part of the bailout bill. This bill should have stood on it's own. We American's are sick and tired of the practice in Washington of padding bills with other agendas that have nothing to do with the bill. These are the congressmen that need to be voted out in the next election. We need common people with common sense.

    October 3, 2008 at 5:19 pm |
  15. Cindy

    I think you need to look again. The reality is that your party was all in on this deal with Bush while the Reps were the holdouts. So your reasoning is way off.

    And as far as high budgets and deficits go...UMM...who Jesse controls congress these days? HMMM!? It is the dems! They have the power to nix anything that they want. So laying the blame all on Bush is ridiculous when congress is the ones that passes all of these bills spending all of this money. Your reasoning is off again. Bush does not and can not pass a bill on his own!

    When will you and your party take responsibility for your actions and stop blaming everyone else? To be factual this mess started way back with Jimmy Carter...a dem...and went on into..Clinton..a dem, who signed the deregulation bill. So tell the truth or take your blinders off one.


    October 3, 2008 at 5:01 pm |