Working families have experienced decades of stagnant wages and eroding healthcare and pensions. Median incomes have still not recovered from the recession of 2001, and now taxpayers are being asked to foot a gargantuan bill for economic excesses we never enjoyed. As Congress and the administration fumble around for a solution to the credit crisis, here are a few principles that should guide any final outcome:
1. Don't waste our tax dollars. We need that money for comprehensive healthcare reform and clean, renewable energy, among other things. Of course, we need independent oversight of any expenditures and an equity stake in any participating companies. We should also consider imposing a tax on financial transactions, which could raise about $100 billion annually.
2. Don't pay off the perps. When Democrats rightly proposed limiting executive compensation as a condition of any bailout, Secretary Paulson actually said that this might discourage participation. It can't be that big a financial crisis if execs would rather forfeit the aid than give back a chunk of excessive compensation.
3. Help homeowners stay in their homes.
4. Rebuild the real economy. It should be obvious that you can't run a consumer economy on debt and low wages. We need a second economic stimulus package that extends unemployment benefits, provides aid to cities and states, and creates good jobs by rebuilding crumbling schools, roads, bridges and water systems. In the medium term (next year!), we should enact the Employee Free Choice Act, so that more workers can join unions and bargain for their fair share of the wealth they create.
5. Re-regulate our financial sector, so we don't end up right back where we started.