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Bailout Needs Bigger Taxpayer Upside

Public should expect some reward for taking on Wall Street's bad debt

By Rob Quinn, Newser Staff

Posted Sep 23, 2008 1:00 PM CDT

(Newser) – The impending bailout of beleaguered Wall Street behemoths should give the taxpaying public some protection and accountability, writes EJ Dionne Jr. in the Washington Post. The deal should allow the government to claim a stake in financial firms that make money from the bailout, giving taxpayers the chance to reap some rewards in exchange for taking such a large risk.

The current proposal by a Democratic senator to add this detail to the bailout plan would also shield the government from overpaying for some of the difficult-to-price debt it’s about to buy. “Taxpayers get at least some of the money back when the company's stock goes up,” Dionne writes. “The bottom line should be: no potential upside for the taxpayers, no bailout.”

[Images (3)]

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Treasury Secretary Henry Paulson appears for an interview with George Stephanopoulos on ABC's This Week, in Washington, Sunday, Sept. 21, 2008. (AP Photo/ABC News, Fred Watkins)

Treasury Secretary Henry Paulson appears on CBS's "Face the Nation" in Washington, Sunday, Sept. 21, 2008. (AP Photo/CBS Face the Nation, Karin Cooper)

A foreclosed home is seen for sale in Sacramento, Calif. in this July 2, 2008 file photo. (AP Photo/Rich Pedroncelli, file)

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There is a moral problem for capitalism itself if taxpayers take on a burden created by the foolishness of the privileged and get little compensation in return. - Washington Post columnist EJ Dionne Jr.

If Congress can appropriate $700 billion for Wall Street, where is the help for everyone else hurting in this economy? - Washington Post columnist EJ Dionne Jr.

Sadly, this bailout is inevitable. But it should be done right. Congress shouldn't be bullied into passing a flawed plan that will leave the next president in an even deeper hole. - Washington Post columnist EJ Dionne Jr.

If taxpayers take risks, they should be able to reap some of the rewards. - Sen. Jack Reed (D-R.I.)

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Bailout Needs Bigger Taxpayer Upside