This is much better than the 3 Page Paulson bill, but there are still some areas for improvement, in my humble opinion:
- Positive: There are stated provisions with some "shall" language for taxpayer benefit. There are very good provisions, including repayment of the public debt
- Negative: There are many more "may" provisions with regard to the taxpayer
- Positive: There are layers of oversight and transparency - reports to Congress, a Board for oversight, GAO study, Inspector General, posting of transactions on the web etc.
- Negative: Maybe I missed it, but there does not seem to be a definitive mechanism to require Paulson to do anything more than listen. Yes, he has to report and make his actions transparent, but it appears that he still calls the shots. And the Board has all the people who were in positions of responsibility all along and there was limited oversight - to be diplomatic
- Positive: There is a call for a study for accounting and regulatory reform
- Negative: The study for regulatory reform is due by April 2009. The study - not the action. So what happens in between? No need to overregulate. But a "study" and, most importantly, some action, respectfully, needs to come before April 2009 or the US will have to live by the rules set by the rest of the world if it is to participate in global economy. There is universal agreement for urgent action on national and global regulatory reform.
- Big Negative: "without limitation" remains in the language, and there are provisions for "guarantees" which are contingent liabilities.
- Reality: You can bet that no matter what the language is companies with highly paid brilliant attorneys have more resources to make this legislation work for them, rather than the country. No legislation is perfect; no implementation is perfect - this is better than the Paulson bill, but its not "the best". There is no such thing as "the best", but the legislation needs to make sure it does not allow for implementation to be hampered either by too many restrictions on power, or too much allowance of power. There is a delicate balance to be struck. Law cannot be "undone" without another legislative amendment.
- Bottom line: In an ideal world, this would really benefit from a public private sector commitment to the stability of the markets and the revival of the economy, i.e. for everyone to act in the national interest. But at least this proposed legislation is not silent on taxpayer benefit which really, I think, was the most important thing for justifying spending taxpayer funds.