Thread by @doctorow

It's been barely a decade since the USG bailed out big businesses and the fact that we're here again reveals some of the glaring failures in the last bailout. Any new bailout should correct those errors by putting restrictions on bailed-out companies.

pluralistic.net/2020/03/19/gb-…

1/

There have been some good proposals on these lines, like those from @AOC and Stephanie Kelton:

pluralistic.net/2020/03/21/mos…

(whenever I write about this in public, I'm inundated with angry tweets from sociopaths with "investor" in their bios)

2/

We're running out of time to get this right. DC is so filled with money-hungry lobbyists that they can't practice adequate social distancing, and they're collectively seeking trillions in string-free public money for their paymaster.

ineteconomics.org/perspectives/b…

3/

At a minimum, any bailouts should come in exchange for convertible corporate bonds that let the USG take an ownership stake in any business that fails to repay its public debts. That's a minimum, as is a ban on stock buybacks for bailed out companies.

4/

We need very strict limits on lobbying by bailed out firms: "If we are not to finance our own bamboozlement, any company receiving bailouts must be required each month to file full reports on political contributions and lobbying expenditures to candidates and parties."

5/

This goes for dark money contributions, including 527 funds, and corporate/exec contributions to trade associations and other lobbying fronts, think-tanks, and other political influence vehicles.

6/

"Unlike last time, when Hank Paulson, Tim Geithner, and Ben Bernanke failed to give the public a serious share of the upside, the bailed out firms should be compelled to issue convertible bonds to the government."

7/

"Those bonds should make the government the senior creditor to the firm for the value of the principal as long as the debt is unpaid...As firms and the economy recover, the shares can be sold on the open market, yielding a handsome return to the Treasury."

8/

The right likes to harp about "moral hazard" as an excuse for cutting aid, to, say, single mothers ("It only encourages them"). But what about businesses that needed trillions in 2008 and now need trillions more? What lesson are we teaching them?

eof/