Wednesday, September 24, 2008

Bailout letter to senate

Today I wrote a letter to my senators about the upcoming congress vote on the bailout of Wall Street. I do not believe that it is fair for the government to be privatizing profits and socializing losses. We the people - not we the congress, not we the corporations. WE THE PEOPLE should not be bailing out the corporations who took a gamble and lost.

Congress will be voting on this by Friday (they are taking another recess already so soon after taking the entire month of August off). If you want your voice heard on this, you must email, call, or fax your letters to them this week! There is no time to mail your letters.
You can use this handy tool to find the contact information for your Senators:

Feel free to use this letter, modify it, or pen your own. Not only is your future on the line - your children's future will also be drastically affected by the outcome of this vote.

Dear Senator :

I read recently in the New York Times about Bank of America's proposal to create a "Federal Homeowner Preservation Corporation that would buy up billions of dollars in troubled mortgages at a deep discount, forgive debt above the current market value of the homes and use federal loan guarantees to refinance the borrowers at lower rates" (New York Times, Feb 23, 2008).

I must express my outrage that a taxpayer-funded "bailout" for the huge financial institutions is being considered by Congress. This proposal—and others like it that I expect could emerge soon—are deeply troubling and socially destructive. They reward the risky behavior on the part of real estate speculators and big banks—behavior that has made safe and clean homes unaffordable for the average working American

The government's responsibility is to create and maintain laws (aka: regulations) to prevent banks / realtors / home buyers creating another disaster like this in the future. The government should not be privatizing profits and socializing losses. At this time, it is NOT the government's responsibility to save banks and home buyers from financial ruin after gambling their money and losing.

Any government intervention that seeks to soften the correction in housing prices or forgive debt is simply distributing the consequences of bad investment decisions by a tiny percentage of citizens to hundreds of millions of hard-working Americans. If the financial sector had not been de-regulated to today's point in the first place, we wouldn't be facing this situation now.

1) Many people in need of bailing out are there because they overextended themselves, not because they are poor.

2) The cost to bail these people out comes from everyone's pocket, even those who were responsible.

3) Because irresponsible people are buying homes at vastly overpriced values, responsible people are being priced out of the market. If you bought your home for the right reasons it should not matter that its value in the past 2 years has dipped over the course of 30 years. If you bought your home to make a quick buck, we don't want to pay for your gamble.

A home buyer must prove current income high enough to make the maximum payment during the life of the loan. The income must also be able to cover all known housing expenses such as taxes, insurance, association fees. As a responsible homeowner, I made sure I could meet my obligations before signing my mortgage. Now, my tax dollars are being used to bail out those that weren't as responsible. Hardly seems fair to a person who works hard to provide for my family and lives within my means.

4) The banks that gave sub-prime loans were gambling and lost. We don't bail out gamblers who go to Vegas, why is this different?

5) Bailing people out now will not stop the irresponsible behavior. Bail people out once and they will expect it again.

The Fed has already cut interest rate to 3.5%. This action causes inflation which is a burden on middle and lower classes that depends on salaries and suddenly have rising costs. It's essentially a hidden tax. Meanwhile, it's a boon for banks. If they can't make money in this environment, they should be out of business.

Do not be seduced by Wall Street lobbyists telling you that "the sky is falling" – if we really are heading into a depression, the government should not spend its last remaining dollars on saving leveraged homeowners and Wall Street speculators. They'll be more important things to save like teacher salaries and infrastructure when the real crisis hits.

Please keep your constituents wishes and futures in mind when working on this very important issue. It affects all Americans.

Thank you,

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