I'll grant you that the plan could be better, but there has been an awful lot of confusion about who this money is going to.
Untrue.
Both shareholders and employees are primary beneficiaries of this plan.
Compare the fate of Lehman (no bailout) with firms that have had the bailout. Compare, for instance, the relative positions of Lehman employees (most of whom are not being paid and are unemployed) and Fannie and Freddie employees (who are being paid and still have their jobs, thanks to the taxpayer takeover).
Compare the share price that Bear Stearns shareholders got ($10 per share) with what Lehman shareholders got (14 cents per share, likely going to zero when they are delisted as part of the bankruptcy proceeding).
This statement is 100% WRONG. Anyone who believes that hasn't been paying any attention to what the government is saying.
The plan being pushed by President Bush and Wall Street and now being discussed by congress is to purchase low rated securities from lenders and investments firms.
These may be packages of thousands of mortgages but will also be derivitives and other instruments based on motgages and other loans.
The money will go to the people who made bad investments - not to individual borrowers or depositors.
Taxpayers will be purchasing the bad loans that investors believe will not be profitable (ones that were, or will be foreclosed or not paid back).
Under discussion is a plan to extend the buyout to almost all bad investments held by investment banks and other lenders. Credit cards, consumer loans, car loans - you name it - they want to throw everything in the deal and scam as much taxpayer money as possible before people wise up to the scam.
In plain english it means that the bailout will just use taxpayer money to pick up all the bad credit and loans so the people who made them won't lose money.
They are also planning on buying the same bad loans and investments from foreign banks and companies doing bussiness in the USA. So we will also see hundreds of billions of taxpayers' dollars going to bail out foreign banks and investment firms that made foolish investments.
One of the issues delaying the plan is that no one really knows what these securities are worth - some are worth zero - others may have some value in the future.
The government officials pushing the plan and the people holding the bad paper want the purchase price to be set as near to the face value as possible.
A few cooler heads in congress are trying to object to this - they want the paper to be valued down around what it would be worth to a potential buyer on the open market, and that wouldn't be much. bad debt like this is commonly sold off for a few pennies on the dollar, if you can even find a buyer.
The whole thing is a giant scam to use trillions of taxpayer dollars to bail out wealthy friends and cronies of politicians and bureaucrats.
If it wasn't a scam the government would stay out of it or, at the most, offer bridge loans to get investors through this period until they could pay the taxpayer back at some future date - as was done with Chrysler back in 1980.
But these people do not want a loan - they want to just dump their bad loans on taxpayers. The details are more complex and worse than my brief description here.
And since the people pushing the plan are trying to expand the type and amount of debt they will cover, the final cost to taxpayers will probably be several trillion dollars.
Remember this - the people out of government pushing the plan are those who created the mess to begin with. And the people in government pushing the plan are the ones who get billions in political contruibutions from the group that will get the bailout money. Everyone makes out except the lowly taxpayer.