More Public Voice in Government-Rescued Companies:
"“Taxpayers instinctively continue to dislike the idea that their tax dollars have been used to bail out Wall Street as Main Street continues to suffer,” said Representative Edolphus Towns (D-NY) at a Center for American Progress event on September 16, which was one year to the day of the AIG rescue. Towns shared the public’s outrage that their tax dollars were used to save large companies such as AIG, CitiGroup, and General Motors from bankruptcy. The bailouts also lacked transparency and accountability measures so the public could see that their interests were being protected."
Towns praised a paper from Emma Coleman Jordan, professor at the Georgetown University Law Center, which was released at the event and proposes placing public directors on the boards of private entities that receive substantial public funds. Jordan asserted that placing government officials on the boards of rescued companies would make the companies accountable to the public and ensure that funds are being appropriately spent.
Towns compared the public’s investments to those of Warren Buffet and asked, “Would Warren Buffet invest billions of dollars in a company without getting a seat on the board?” The answer was an unequivocal “no.”
Byron Georgiou of the Financial Crisis Inquiry Commission—the group charged with investigating the causes of the collapse of each major financial institution—thought that Jordan’s proposal was sound if taxpayers were considered to be investors in the traditional sense, like Buffet. However, he questioned whether taxpayers were really just donating money to financial institutions and making the judgment that they had to save the institutions because they were “too big to fail.”
"“Taxpayers instinctively continue to dislike the idea that their tax dollars have been used to bail out Wall Street as Main Street continues to suffer,” said Representative Edolphus Towns (D-NY) at a Center for American Progress event on September 16, which was one year to the day of the AIG rescue. Towns shared the public’s outrage that their tax dollars were used to save large companies such as AIG, CitiGroup, and General Motors from bankruptcy. The bailouts also lacked transparency and accountability measures so the public could see that their interests were being protected."
Towns praised a paper from Emma Coleman Jordan, professor at the Georgetown University Law Center, which was released at the event and proposes placing public directors on the boards of private entities that receive substantial public funds. Jordan asserted that placing government officials on the boards of rescued companies would make the companies accountable to the public and ensure that funds are being appropriately spent.
Towns compared the public’s investments to those of Warren Buffet and asked, “Would Warren Buffet invest billions of dollars in a company without getting a seat on the board?” The answer was an unequivocal “no.”
Byron Georgiou of the Financial Crisis Inquiry Commission—the group charged with investigating the causes of the collapse of each major financial institution—thought that Jordan’s proposal was sound if taxpayers were considered to be investors in the traditional sense, like Buffet. However, he questioned whether taxpayers were really just donating money to financial institutions and making the judgment that they had to save the institutions because they were “too big to fail.”
