After the House Rejection of the Bailout Plan & the Dow Jones Plunge: * Labor Must Not Bow to the Wall Street Blackmail

After the House Rejection of the Bailout Plan & the Dow Jones Plunge:


* Labor Must Not Bow to the Wall Street Blackmail


* Labor Must Mobilize to Put a Full Stop to the $700 Billion Corporate
Bailout and Fight for an Emergency Plan to Bail Out Working People


By ALAN BENJAMIN
(Editor of The Organizer Newspaper)


Sept. 29, 2008 -- The House of Representatives voted today to defeat the $700 billion Wall Street bailout plan that had been worked out over the weekend at the insistence of President George W. Bush and House Speaker Nancy Pelosi. The proposed plan aimed at nationalizing the debt of the bankers who profited from the home-mortgage speculative orgy of the past few years.


By a vote of 227 to 206, the House killed the bill -- with 94 Democrats and 133 Republicans voting against the bailout plan.


The vote stunned much of the media and establishment. Bush, Pelosi, and House Minority leader Boehner had aggressively pushed the revised bailout plan. A narrow YES vote was widely expected. So great was this expectation that Senate majority and minority leaders anticipated they would be voting today in the Senate to approve the agreement passed in the House.


Almost immediately, in reaction to the vote in the House, the Dow Jones industrial average lost 777 points Monday, its biggest single-day fall ever.


Soon after, in response to this stock market dive, Democrats and Republicans -- prompted by Bush, Secretary of the Treasury Henry Paulson, Pelosi and Boehner -- pledged that they would try again to get a bailout plan passed in the House on Thursday, Oct. 2. It was agreed that the House would reconvene on Thursday, instead of adjourning for the year as planned.


Simply announcing that a new vote would take place on yet another bailout plan was necessary, Paulson announced, to "restore confidence" in the credit markets. Paulson then warned that the members of Congress had to go back to the drawing board. "We need to work as quickly as possible," he said. "We need to get something done. ... We need to put something back together that works."


Nancy Pelosi chimed in. "What happened today cannot stand," she said. "We must move forward, and I hope that the markets will take that message."


Pelosi was joined in her plea by Barack Obama, who stated, "Democrats, Republicans, step up to the plate, get it done." Likewise, John McCain urged Congress "to put partisanship behind them and vote a plan to rescue the credit markets and the economy."


So, why this defeat, when all the media pundits had predicted the victory of the bailout plan?


David Sirota wrote in his blog on Campaign for America's Future (Sept. 29) that, "the fear of being thrown out of office is forcing our politicians to at least consider what the public wants."


Sirota continued,


"Polls overwhelmingly show a public that sees voting for this bill as an act of economic treason whereby the bipartisan Washington elite robs taxpayer cash to give their campaign contributors a trillion-dollar gift.


"As just two of many examples, Bloomberg News' poll shows 'decisive' opposition to the bailout proposal, and Rasmussen reports that their surveys show 'the more voters learn about the proposed $700 billion federal bailout plan for the U.S. economy, the more they don't like it.' ... Any sitting officeholder that votes for this -- whether a Democrat or a Republican -- should expect to get crushed under a wave of [Left and Right] populist-themed attacks from their opponents."


Pressures Will Mount to Approve the Corporate Bailout on Thursday


Republicans who voted against the consensus plan -- the largest voting bloc against the plan -- blamed the Democrats for amending the bailout package with language calling for too much government intervention. Some called this "socialism." One Republican Congressman invoked the Bolshevik Party and its takeover of the "free-market" economy.


The crisis in the political summits, and corporate boardrooms, is reaching the boiling point.


The bankers and financial institutions have now warned that they will not sit back and permit a deal to fall through their fingers. The Chamber of Commerce and Business Roundtable immediately activated their lobbying of House Republicans and Democrats. They are hoping that the stock market "scare" today will prompt all members of Congress who voted against the bailout to re-think their vote.


At this writing, many analysts predict that some modifications will be made to the plan defeated today -- to appease the House Republicans. But given the "fragile nature of the compromise," one economist quoted on ABC TV stated, it is not likely that the changes will be that significant. Less Congressional oversight and fewer restrictions on the "golden parachutes" of the CEOs of the financial institutions are expected. Also possible is an apology by Pelosi for statements made prior to the vote that were considered "too partisan" and "too inflammatory" by 12 Republicans, who claimed that these statements prompted them to vote against the bill.


But all this only underscores one fundamental question facing working people across the country who have opposed any corporate welfare plan: They and their representatives in the House will be pressured -- blackmailed is more like it -- by the Wall Street speculators and told they must accept what is unacceptable to them.


We can expect a major push for "national unity" with the Wall Street thiefs in the coming days. We will be told to put all partisan concerns aside in the interest of the economy and the nation. Every argument imaginable will be brought out to drive the American people to accept this corporate welfare plan. What is good for Wall Street is what's good for Main Street, we will hear again and again.


This, of course, is one BIG LIE.


More than ever, working people, with the trade unions in the lead, need to mobilize massively to put a definitive stop to this corporate bailout ... and to demand a Workers Recovery Plan that bails out America's working people and the oppressed.


Putting forward an alternative plan is, in fact, becoming a burning necessity. We will be told by all the corporate-owned media that There Is No Alternative to their corporate heist. But there is an alternative -- one that bails out working people and the economy, not the speculators who got us into the mess we're in today.


An Emergency Plan to Bail Out Working People and the Economy


What would such a plan look like? Here are five essential components (and there could be many more) which we in The Organizer newspaper submit for the widest discussion among unionists and activists:

1) Nationalize the Federal Reserve and Establish a Federally Owned, Public Banking System


This is necessary to make credit available for small businesses, homeowners, manufacturing operations, renewable energy and infrastructure investments.

This (re)nationalization should begin with Fannie Mae and Freddie Mac, so that the government, through these two institutions, can stop all foreclosures.

Only through a State-run Emergency Board will the real economy be able to get back on its feet, removed from its addiction to war and speculation.


The "free market" is what has created the worst financial crisis since the 1930s. The people who created this mess should not be allowed to continue to run the financial system.

2) End all Funding for the U.S. Wars in Iraq and Afghanistan and Slash the Military Budget


All the funds that have been allocated to the U.S. wars and occupations around the world, and all the military bases needed to sustain these wars, must be re-oriented post-haste toward meeting human needs -- by funding public education, libraries, hospitals, roads, public housing, Reconstruction for the Gulf Coast, social services and more.


3) Moratorium on All Home Foreclosures, Utility Shut-Offs and Evictions


A genuine plan to protect homeowners could include the following points:


- enact a foreclosure moratorium now, before the next phase of ARM interest-rate increases take effect;


- refinance mortgages into 30- and 40-year loans at reasonable rates of interest -- but at the current market value of their homes, not the inflated prices of the boom;

4) Massive National Reconstruction Public Works Program


A WPA-type program is needed urgently to rebuild the nation's schools, hospitals and crumbling infrastructure and to put millions of people back to work, with a living (prevailing) wage and with the unfettered right to join a union and to wield their collective strength, including through strike action (for which the repeal of Taft-Hartley is essential), to press for better wages and working conditions

5) Sliding Scales of Wages to Keep Up with Inflation


This will be needed to enable working people to offset the rising cost of living produced by the "staglation" that has already reared its ugly head and is bound to increase in the coming weeks and months.


Not One Taxpayers' Dollar For the Wall Street Speculators!


Any plan that calls for using taxpayers' dollars to pay back the speculators must be stopped. Every dollar that goes to a speculator is one dollar less that could go to rebuilding the economy and putting millions of people back to work through a mass public works program. These speculators gambled and they lost. They are parasites. They are not needed. Their profits should be confiscated. There should be no pandering to them in the name of "helping Wall Street." Bailing them out is not necessary to stave off the financial crisis. On the contrary, it will only deepen the problem.


For our part, we in The Organizer newspaper pledge to do everything in our power to help build the most powerful labor-led fightback movement to stop this corporate assault. What's at stake is the fate of millions of working people at home and abroad.


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