Letter to my Senator
Sept. 23, 2008
Dear Mr. Obama,
I know you are busy with your presidential campaign, but I wanted to take a moment to write you and urge you to return to Congress to fix the President's bailout proposal. America needs leadership on this issue now and you are the person to provide it. I've supported your campaign both as my Senator and as President. While something legislative probably needs to be done about our financial system, the President and his administration have not made that clear.
First, in the interest of transparency, please urge Sec. Paulson to make his presentation today on the state of the economy public. We can't trust the Bush administration on anything and the public deserves to see the data and have it reviewed by independent economists.
Second, urge restraint on Congress. It has been almost a week since Sec. Paulson announced his plan and no new major firms have gone into crisis. In fact, the remaining investment banks are working to shore up their capital positions without any government assistance. This program may be totally unnecessary.
Third, there is no reason Congress needs to commit to the full $700B budget immediately. Sec. Paulson testified in Congress today that he expects to spend about $50B a month. Given that timetable, Congress could simply allocate $150B now and then consider whether more needs to be spent later when it returns to session in January.
Finally, there is absolutely no reason why the financial firms need be given incentives to participate in this program. This should be a last-resort measure for troubled institutions and as such they should accept nearly any condition on receiving the funds, including the dilution of equity in their firm. The taxpayers deserve to be compensated for their increased risk.
Thank you for considering my comments. For full disclosure, I work in the trading and finance industry in Chicago and have donated several hundred dollars to your presidential campaign. We need your leadership now. Please demonstrate how you would lead as president.
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I've also written a similar article to my other Senator, Richard Durbin and my Representative, Luis Gutierrez.