Skeptics on the left and the right have misgivings about using taxpayer funds to buy hundreds of billions in distressed mortgage debt. to unclog the financial markets
On a Friday conference call, conservative Rep. Paul Ryan (R-Wis.) asked Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke if they had given any thought to using private money to buy this debt. Paulson said the private sector was under too much pressure to produce the necessary capital.
On Saturday, Vermont Independent Sen. Bernie Sanders went two or three steps further in the opposite direction, offering a proposal to impose a 10 percent surtax on couples who makes more than $1 million annually or individuals who make more than $500,000. He estimates this increase would raise $300 billion for the federal government over the next five years — or less than half of the $700 billion Treasury has asked for.
“If this bailout is necessary, it should not be middle income or working families who have to pay for it,” Sanders said. “It should be the people who benefited from President Bush's disastrous policies, including the very wealthiest people in this country.”
The liberal senator also issued a call for a "major economic recovery package" and legislation to institute new regulations on commodity speculators and the financial institutions that created this slide.
These proposals face long odds on their own, but Sanders goes even further by advocating the dismantling of giant corporations, saying, “We must end the danger posed by companies that are ‘too big too fail,’ that is, companies whose failure would cause systemic harm to the U.S. economy. If a company is too big to fail, it is too big to exist.”