No more blank checks for you, Wall Street!
That’s the message Senator Elizabeth Warren says that Congress must deliver to the nation’s “captains of industry”, many of whom are now sending their lobbyists to Capitol Hill to plead for fiscal aid. The aviation industry, the hospitality industry, and others are all reeling from the effects of the rapidly worsening coronavirus pandemic, and want taxpayer assistance to avert catastrophe.
Warren says it would be irresponsible to offer federal aid with no conditions, as Congress unwisely did twelve years ago. The bank bailout succeeded in stabilizing the banks, and they repaid the United States Treasury, but the opportunity to compel them to change their behavior was squandered. Today, the banks are even bigger and they continue to engage in predatory lending practices.
Lesson learned. Congress must insist upon conditions for any bailout package. And since the presidency and the United States Senate are currently controlled by Republicans friendly to Wall Street, it will assuredly be up to Speaker Nancy Pelosi and her caucus to put together legislation that doesn’t write a blank check.
We’re not writing blank checks to giant corporations. Any taxpayer dollars that go to help big businesses during the coronavirus crisis should come with the following minimum requirements:
- Companies must maintain their payrolls and use funds to keep people working or on payroll.
- Companies must provide a $15 minimum wage within one year of the national emergency declaration ending.
- Companies are permanently prohibited from engaging in share repurchases.
- Companies are prohibited from paying out dividends or executive bonuses while they are receiving any relief and for three years thereafter.
- Companies must set aside at least one seat – but potentially two or more, as the amount of relief increases – on the board of directors for representatives elected by workers.
- Collective bargaining agreements should remain in place and should not be reopened or renegotiated pursuant to this relief program.
- Corporations must obtain shareholder and board approval for all political expenditures.
- CEOs must be required to personally certify a company is in compliance and face criminal penalties for false certifications.
Congress must set up an oversight body, modeled on the Congressional Oversight Panel and the SIGTARP program for the bank bailout, but with real funding & subpoena power. We need real accountability to make sure these conditions are met.
These are great ideas and we’re thrilled to see Senator Warren stepping up to provide bold progressive leadership in a time of crisis.
In the 1930s, when Franklin Delano Roosevelt came into office, he didn’t just work to stabilize America’s society and and economy. He worked to implement reforms to protect the country from a future depression or recession.
That’s how we ended up with Social Security, with the Glass-Steagall Act, with federal deposit insurance through the FDIC, and with new infrastructure built by the Works Progress Administration and the Civilian Conservation Corps.
A crisis like this is an opportunity to build a more inclusive, equitable, and broadly prosperous society, and it must not be squandered.