One Utah

Over at MSNBC, there is a nice synopsis of the Bailout deal - it goes through each section and summarizes what it means.

A couple sections jumped out at me, but of course the devil is in the details and this is a long, complex bill trying to unravel a complex, ill defined problem that has multiple causes.

Section 110. Assistance to Homeowners.
Requires federal entities that hold mortgages and mortgage-backed securities, including the Federal Housing Finance Agency, the FDIC, and the Federal Reserve to develop plans to minimize foreclosures. Requires federal entities to work with servicers to encourage loan modifications, considering net present value to the taxpayer.

Section 111. Executive Compensation and Corporate Governance.
Provides that Treasury will promulgate executive compensation rules governing financial institutions that sell it troubled assets. Where Treasury buys assets directly, the institution must observe standards limiting incentives, allowing clawback and prohibiting golden parachutes. When Treasury buys assets at auction, an institution that has sold more than $300 million in assets is subject to additional taxes, including a 20% excise tax on golden parachute payments triggered by events other than retirement, and tax deduction limits for compensation limits above $500,000.

Section 123. Credit Reform.
Details the manner in which the legislation will be treated for budgetary purposes under the Federal Credit Reform Act.

Section 134. Recoupment.
Requires that in 5 years, the President submit to the Congress a proposal that recoups from the financial industry any projected losses to the taxpayer.

Section 302. Special Rules for Tax Treatment of Executive Compensation of Employers Participating in the Troubled Assets Relief Program.
Applies limits on executive compensation and golden parachutes for certain executives of employers who participate in the auction program.

I’m not wild about the bailout. Given that the bill was rushed through, it’s probably the best we can expect. I’m not wild about how much authority it grants to appointed officials in the administration and frankly, I know this makes me sound like a crazy person, but I’m disappointed Congress didn’t use this law as an opportunity to adjust the balance of power in government - to increase Congressional power and reduce the power of the Imperial presidency.

This entry was posted Sunday, September 28th, 2008 at 7:04 pm and is filed under American History, Economic Exploitation, Economy. You can leave a response, or trackback from your own site.