The reason for the bailout is to increase liquidity-- to insure that money for borrowing is available. That money will enable investors to keep investing in stock trades, bonds, mortgages, business loans, etc. and of course, will enable borrowers to borrow.
"In the United Kingdom, for example, whenever you buy or sell a share of stock (or a credit swap or a derivative, or any other activity of that sort) you pay a small tax on the transaction. We did the same thing here in the US from 1914 to 1966 (and, before that, we did it to finance the Spanish American War and the Civil War).I say add that same tax to loans as well. When a person takes out a mortgage, with less than a minimum amount of down payment, there's an extra fee, usually .25% or .5% charged as mortgage "insurance," called PMI. When the fed raises interest rates a quarter point to affect the economy, nobody screams. Why not take this kind of light touch approach to make the bailout solution pay for itself and remove the risk that main street now faces.
For us, this Securities Turnover Excise Tax (STET) was a revenue source. For example, if we were to instate a .25 percent STET (tax) on every stock, swap, derivative, or other trade today, it would produce - in its first year - around $150 billion in revenue. Wall Street would be generating the money to fund its own bailout. (For comparison, as best I can determine, the UK's STET is .25 percent, and Taiwan just dropped theirs from .60 to .30 percent.)"
In this case, the bailout is making it possible for credit to be available. Make the beneficiaries pay that small tax that will, in a few years, entirely recover the $700 billion.
Now, I expect the Libertarians and Republicans to oppose this, just like they oppose all taxes. It's similar to the way that right wingers oppose taxes to pay for roads, police, schools, research, health care for the elderly... all the things that keep a society functioning.
This ought to do the trick to get all the fiscally conservative bluedog democrats on board, since this approach actually pays for the bailout. Some right wingers may oppose it still, but at least this approach protects America and Americans from being stiffed. And the next president will have an opportunity to turn the "investment" into a win.
I don't understand why this idea isn't being discussed. Why aren't the mainstream media reporters talking about the idea of a small tax to insure recovery?
Call them. Email them. Tell them that they should be covering this angle on the story.