Brent Budowsky, The Hill, August 20, 2007
Here is the problem with the Federal Reserve bailout of banks, rather than providing support to homeowners, citizens or the economy as a whole:
Check out the New York Times Aug. 20 story about how those who had their homes foreclosed on by banks often get huge tax bills from the IRS, while the banks buy the home back, at times for $1.
Understand that contrary to much of the snide, condescending coverage in some of the media, many who are foreclosed upon had good-paying jobs that were cut back, laid off, or outsourced, and others had good-paying jobs but suffered major health problems, with ripoff costs imposed by an unjust healthcare system.
In the real world, here is how it can work:
A person takes out a $100,000 mortgage and has a $65,000 salaried job. That person gets his or her hours cut back, or wealthy executives downsize the company while they keep their large salaries and stock options, or ther job is lost by outsourcing to a country that pays slave wages with no benefits. Or the person suffers a health problem and incurs huge costs, which benefit wealthy healthcare companies, while consumers fight wealthy insurance companies and of course well-paid doctors.