Impeachment: What the House Should Have Said

Trump's Conviction Should Have Been A Slam Dunk
President Trump's defenders excuse his urging Ukraine (plus earlier Russia, and later China) to interfere in our elections. They are left with the argument that he may have done it, it wasn't a nice thing to do, but it's not an "impeachable offense." 

The House Democrats' characterization of their first article of impeachment isn't much better: "Abuse of Power." Saying the president "violated his oath of office," or "the Constitution," provides little more specificity than "abuse of power" (even when supported with evidence of Trump's pressure on Ukraine).

What's an "impeachable offense"? There can be, and has been, debate as to whether individual examples of presidential bad behavior should constitute a basis for impeachment. But there are two as to which there is little or no question.

Many conservatives argue that we should be bound by what the Constitution's drafters intended. Most lawyers would at least agree "original intent," or "legislative history," are at a minimum relevant evidence to consider in defining and applying terms.

What the House Democrats should have emphasized for a confused public (and Republican Senate), is why Trump's impeachment, and Senate conviction, should be a slam dunk. It is because, unlike other behavior that has, or has not, been found to be impeachable during the 62 impeachment hearings in the House since 1789, what Trump has been doing is something the drafters had experienced, caused them great legitimate concern, and they specifically tried to prevent: namely, foreign interference in our politics, government, and especially elections, whether sought from within or imposed from abroad. [Photo credit: Constitutional Convention; original painting by Junius Brutus Stearns, painter; photo is public domain, commons.wikimedia.org.]

This assertion is supported by numerous references in the history of the time, The Federalist Papers, and notes from the Constitutional Convention. But one need go no further than the Constitution's provisions. "Treason" ("the crime of betraying one's country") is specifically mentioned as a ground for impeachment. Presidents must be born in the U.S. They are forbidden to accept any "emoluments" (gifts or titles) from other countries.

[A second specific but more general concern, tangentially related to to the drafters' efforts to avoid foreign influence, was their insisting on preventing future presidents from assuming the powers of a king. Their earlier Declaration of Independence made that clear: "The history of the present King of Great Britain is a history of repeated injuries and usurpations, all having in direct object the establishment of an absolute Tyranny over these States" -- following which they offer a long list of the Declaration's equivalent of "articles of impeachment" of the King. And then: "A Prince whose character is thus marked by every act which may define a Tyrant, is unfit to be the ruler of a free people."

These concerns continued through the Constitutional Convention, ultimately taking the form of the "checks and balances" on the executive provided by the judiciary, House and Senate; the four-year limit on a president's terms of office, denying presidents the power "to declare war" exercised by kings -- and the ultimate power of the House to impeach, and the Senate to remove, a president.]

I set forth below an excerpt from the House's "Trial Memorandum" for the Senate that deals with these issues (plus the link to the entire document). This discussion of of foreign influence is well done, and documented with footnotes. Unfortunately, it is buried in the "Memorandum" where few will find and read it, and has never been elevated and emphasized for the public, House members and Senators as the most powerful argument for convicting the President.

# # #
TRIAL MEMORANDUM
OF THE UNITED STATES HOUSE OF REPRESENTATIVES
IN THE IMPEACHMENT TRIAL OF PRESIDENT DONALD J. TRUMP

January 18, 2020, pp. 9-12
Fresh from their experience under British rule by a king, the Framers were concerned that corruption posed a grave threat to their new republic. As George Mason warned the other delegates to the Constitutional Convention, “if we do not provide against corruption, our government will soon be at an end.”43 The Framers stressed that a President who “act[s] from some corrupt motive or other” or “willfully abus[es] his trust” must be impeached,44 because the President “will have great opportunitys of abusing his power.”45

43 2 The Records of the Federal Convention of 1787, at 392 (Max Farrand ed.,1911) (Farrand).
44 Background and History of Impeachment: Hearing Before the Subcomm. on the Constitution of the H. Comm. on the Judiciary, 105th Cong. 49 (1998) (quoting James Iredell).
45 2 Farrand at 67.

The Framers recognized that a President who abuses his power to manipulate the democratic process cannot properly be held accountable by means of the very elections that he has rigged to his advantage.46 The Framers specifically feared a President who abused his office by sparing “no efforts or means whatever to get himself re-elected.”47 Mason asked: “Shall the man who has practised corruption & by that means procured his appointment in the first instance, be suffered to escape punishment, by repeating his guilt?”48

46 See id. at 65.
47 Id. at 64.
48 Id. at 65.

Thus, the Framers resolved to hold the President “impeachable whilst in office” as “an essential security for the good behaviour of the Executive.”49 By empowering Congress to immediately remove a President when his misconduct warrants it, the Framers established the people’s elected representatives as the ultimate check on a President whose corruption threatened our democracy and the Nation’s core interests.50

49 Id. at 64.
50 See The Federalist No. 65 (Alexander Hamilton).

The Framers particularly feared that foreign influence could undermine our new system of self-government.51 In his farewell address to the Nation, President George Washington warned Americans “to be constantly awake, since history and experience prove that foreign influence is one of the most baneful foes of republican government.”52 Alexander Hamilton cautioned that the “most deadly adversaries of republican government” may come “chiefly from the desire in foreign powers to gain an improper ascendant in our councils.”53 James Madison worried that a future President could “betray his trust to foreign powers,” which “might be fatal to the Republic.”54 And, of particular relevance now, in their personal correspondence about “foreign Interference,” Thomas Jefferson and John Adams discussed their apprehension that “as often as Elections happen, the danger of foreign Influence recurs.”55

51 See, e.g., 2 Farrand at 65-66; George Washington, Farewell Address (Sept. 19, 1796), George Washington Papers, Series 2, Letterbooks 1754-1799: Letterbook 24, April 3, 1793–March 3, 1797, Library of Congress (Washington Farewell Address); Adams-Jefferson Letter, https://perma.cc/QWD8- 222B.
52 Washington Farewell Address.
53 The Federalist No. 68 (Alexander Hamilton).
54 2 Farrand at 66.
55 Adams-Jefferson Letter, https://perma.cc/QWD8-222B.

Guided by these concerns, the Framers included within the Constitution various mechanisms to ensure the President’s accountability and protect against foreign influence— including a requirement that Presidents be natural-born citizens of the United States,56 prohibitions on the President’s receipt of gifts, emoluments, or titles from foreign states,57 prohibitions on profiting from the Presidency,58 and, of course, the requirement that the President face reelection after a four-year Term.59 But the Framers provided for impeachment as a final check on a President who sought foreign interference to serve his personal interests, particularly to secure his own reelection.

56 U.S. Const., Art. II, § 1, cl. 5.
57 U.S. Const., Art. I, § 9, cl. 8.
58 U.S. Const., Art. II, § 1, cl. 7.
59 U.S. Const., Art. II, § 1, cl. 1.

In drafting the Impeachment Clause, the Framers adopted a standard flexible enough to reach the full range of potential Presidential misconduct: “Treason, Bribery, or other high Crimes and Misdemeanors.”60 The decision to denote “Treason” and “Bribery” as impeachable conduct reflects the Founding-era concerns over foreign influence and corruption. But the Framers also recognized that “many great and dangerous offenses” could warrant impeachment and immediate removal of a President from office.61 These “other high Crimes and Misdemeanors” provided for by the Constitution need not be indictable criminal offenses. Rather, as Hamilton explained, impeachable offenses involve an “abuse or violation of some public trust” and are of “a nature which may with peculiar propriety be denominated political, as they relate chiefly to injuries done immediately to the society itself.”62 The Framers thus understood that “high crimes and misdemeanors” would encompass acts committed by public officials that inflict severe harm on the constitutional order.63

60 U.S. Const., Art. II, § 4; see 2 Farrand at 550.
61 2 Farrand at 550.
62 The Federalist No. 65 (Alexander Hamilton) (capitalization altered).
63 These issues are discussed at length in the report by the House Committee on the Judiciary. See H. Rep. No. 116-346, at 28-75.
64 Statement of Facts ¶ 160.
65 Id. ¶ 161.

Tags: #Constitution, #Constitutional Convention, #elections, #Federalist Papers, #House, #impeachable offense, #impeachment, #original intent, #legislative history, #President Donald Trump, #Senate, #Trump, #Ukraine

Understanding Impeachment

There is so much nonsense spouted about impeachment these days, whether deliberate obfuscation or unknowingly, that you might find these items useful. (The most basic sources, from the Constitution, are Article II, Section 4 (impeachment power), Art. I, Sec. 2, Clause 5 (possessed by the House), Art. I, Sec. 3, Cl. 6 (trial in Senate). You are spared additional footnotes, though specific citations can be provided if desired.)

This material is hoped, intended and believed to be accurate, but does not purport to be, and is not, either a "legal opinion" or "scholarship."

There are three sections to which these links can take you: (1) The Obligation to Impeach, (2) Impeachment Standard Not "Illegality," and (3) Trump Has Violated the Law. [Photo credit: Wikimedia.]

The Obligation to Impeach. Every president, House and Senate member, and federal judge has sworn to uphold the Constitution. The Constitution requires each branch (legislative, executive and judicial) to maintain the balance of power among the three branches and prevent constitutional violations by the other two.

Thus, it can be argued the House has a constitutional obligation to begin an impeachment inquiry when there is reason to believe a president may have said or done things that precedent suggests constitute “Treason, Bribery, or other high Crimes and Misdemeanors.”

The Congress has no more constitutional right to evade this responsibility, to fail to exercise this specifically granted power, than it has a right to fail to exercise its power to take the census every ten years. It certainly cannot refuse to start an impeachment inquiry because it might be politically harmful to the majority party in the House, or because the president may fail to win reelection. Nor can it fail to impeach because the Senate is unlikely to convict, any more than a grand jury can fail to indict because of the possibility the trial jury may be biased in favor of the accused.

Why? Because there are more reasons for the impeachment power than the potential removal of a specific president. Impeachment is designed to maintain for the future both (1) the standards of presidential conduct required by the founders and (2) exercise of the checks and balances the Constitution compels between the Legislative and Executive branches.

Impeachment Standard Not “Illegality.” President Trump’s defenders have altered their arguments as facts evolved – from, in effect, “he didn’t do it,” to “he may have done it, but he did nothing wrong,” to “he may have exercised bad judgment and done something wrong, but he did nothing illegal,” to “it can’t have been illegal because there was no quid-pro-quo,” to “even if it was illegal, and there was a quid-pro-quo, it is not an impeachable offense.”

As “Late Night” host Seth Meyers would say, “It’s time for a closer look.”

The founders modeled their constitutional standard for impeachment on British practice, which had its origins in 1341. Articles of impeachment in Great Britain included such things as “arbitrary and tyrannical government,” “procuring offices for persons who were unfit, and unworthy of them,” “squandering away the public treasure,” “improprieties in office,” “gross maladministration,” “corruption in office,” “neglect of duty,” excessive drinking and cursing that created “the highest scandal . . . on the kingdom.”

The British practice was to treat impeachment as a remedy separate from the process and standards of the criminal law and to include conduct not expressly recognized as “illegal.”

Interpretation of the U.S. Constitution’s language is influenced, but not bound, by British history. But American history is almost identical. The writings of Constitutional Convention members Alexander Hamilton, James Wilson, and James Madison indicate they believed impeachment did not require criminal offences. Nothing in the records of the states’ ratification of the Constitution indicate they believed impeachment was limited to criminal offenses. Of the first 13 impeachments by the House since 1789 (mostly of judges), at least 10 included charges that did not involve criminal law. Finally, Congress has never attempted to define “impeachment” in Title 18 of the U.S. Code (criminal code).

So far, three U.S. presidents have been impeached (Presidents Andrew Johnson, Richard Nixon, Bill Clinton) and a fourth (President Trump) is undergoing an impeachment inquiry. None, so far, has been removed from office following the Senate trial. (President Johnson was saved by one vote; President Nixon resigned before his seemingly inevitable formal impeachment.)

Each presidential impeachment has involved some article dealing with other than criminal illegality.

As discussed in ”Trump’s High Crimes and Misdemeansors,” October 31, 2019, President Andrew Johnson’s tenth article of impeachment charged “That the President of the United States, unmindful of the high duties of his high office and the dignity and proprieties thereof, and of the harmony and courtesies which ought to exist and be maintained between the executive and legislative branches of the Government of the United States . . . [did] make and declare, with a loud voice, certain intemperate, inflammatory and scandalous harangues, and therein utter loud threats and bitter menaces . . . amid the cries, jeers and laughter of the multitudes then assembled . . ..”

The first of the Articles of Impeachment regarding President Nixon included: “[Nixon] has prevented, obstructed, and impeded the administration of justice . . .. [He has] engaged personally and through his close subordinates and agents, in a course of conduct or plan designed to delay, impede, and obstruct the investigation of such illegal entry [into Democratic National Committee headquarters]; to cover up, conceal and protect those responsible; and to conceal the existence and scope of other unlawful covert activities. “ (This is followed by nine examples.)

Article II, par. 5, alleged that “he knowingly misused the executive power by interfering with agencies of the executive branch, including the Federal Bureau of Investigation . . . and the Central Intelligence Agency.” Article III charged that he “has failed without lawful cause or excuse to produce papers and things as directed by duly authorized subpoenas issued by the Committee on the Judiciary of the House of Representatives . . ..”

President Bill Clinton’s third article of impeachment included, after citing 7 specific items, “In all of this, [Clinton] has undermined the integrity of his office, has brought disrepute on the Presidency, [and] has betrayed his trust as President . . ..”

Taken together, the evidence is overwhelming that the validity of an article of impeachment does not turn on whether a "law" has been violated. Thus, even if it were true, as some Trump defenders contend, that "he has done nothing illegal" it does not follow that, therefore, he cannot and should not be impeached.

But wait, even if one insists that a violation of law is a requirement for impeachment . . .

Trump Has Violated the Law. Although unnecessary for impeachment, for a response to those who argue “he did nothing illegal” or “there was no quid-pro-quo” it seems clear he did violate the law, and that the law he violated does not require proof of a “quid-pro-quo.”

The law involved is contained in Section 30121 of Title 52, United States Code (“Voting and Elections”).

The relevant words are, “It shall be unlawful for . . . a person to solicit . . . or receive . . . from a foreign national ["a . . . thing of value . . . in connection with a Federal . . . election"].

(The primary subsection is Sec. 30121(a)(2). The [bracketed] words are from subsection 30121(a)(1)(A) because Sec. 30121(a)(2) defines what cannot be received as that which was "described in subparagraph (A) or (B) of paragraph (1).")

Thing of Value. Given the quantity of confirming testimony regarding the range of ways that Trump displayed his desire to obtain dirt on former Vice President, and candidate for president, Joe Biden, there can be no doubt he considered such information “a thing of value in connection with a Federal election.”

Solicitation. Notes from Trump’s conversation with Ukrainian President Volodymyr Zelensky included Trump’s now-infamous line, “I would like to ask you to do us a favor, though.” It turns out there was more than one “favor” requested, but one is enough to clearly establish “solicitation.”

Quid-Pro-Quo. Note that the law does not require a quid-pro-quo. So even if there had been no quid-pro-quo that would have been irrelevant to whether Sec. 30121 had been violated. Clearly, it would not have been a defense. But for whatever relevance it may have, it seems to have clearly been the impression of many of those who have testified before Congress that a quid-pro-quo was understood by both presidents.

Without exploring yet another possible crime, the existence of a quid-pro-quo, while irrelevant to Section 30121, may be very relevant to a charge of bribery.

Better Alternatives to Congress' Bailout Plan

October 2, 2008, 7:00, 11:45 a.m.

Senate Bill: Wrong Plan, Favoring Wrong People, at the Wrong Time
Look, I understand that I don't have a Ph.D. in economics or an MBA in finance. But I can smell a hog confinement when the breeze blows in from south of Iowa City, and what is floating in the hot air coming from Washington smells very similar.

I really don't like to say "I told you so." But I predicted almost step by step what was going to happen with our war in Iraq, and it has. And I don't like what I see coming down the road over the next few years as a result of what Washington thinks is a "solution" to our financial woes either.

Nonetheless, I realize that most rational readers of this blog would like to have a little more reassurance on something of this magnitude than just my gut instinct and intuition. So this morning I'm going to wheel in the support of 200 economists and another nation's much more sensible solution to an almost identical challenge.

Do we need to "do something"? Absolutely. I just don't think we ought to be doing "something" that is going to make the situation worse rather than better, and is inherently unfair in terms of whom it benefits (the excessive-risk-taking greedy bankers who created and profited from the problem, along with the excessive-campaign-contribution-taking elected officials who, in exchange, deliberately failed to regulate it) and whom it burdens (the unemployed, working poor, homeowners, and present and future generations of taxpayers).

Don't you have just a little deja vu with the rhetoric from the White House? Doesn't it sound a little like the "mushroom cloud" we were going to be witnessing if we didn't invade Iraq?

[S]ane people were rightfully a little suspicious of the plan to upright the finances of the U.S. by a $700 billion handout funded by taxpayers.

The House was rightly skeptical too, failing to pass the proposal Monday.

But George Bush skipped talking about sacrifice and buckling down in his speech promoting the bailout to the nation. He preferred to persuade us mere peons using fear, as he has in the past. The phrases he chose were dire, scary even: “a long and painful recession” and “our entire economy is in danger.”

"More banks could fail, including some in your community,” he warned. “The stock market would drop even more, which would reduce the value of your retirement account. The value of your home could plummet. Foreclosures would rise dramatically.

“And if you own a business or a farm, you would find it harder and more expensive to get credit. More businesses would close their doors, and millions of Americans could lose their jobs.”

OK, we get it. The markets are falling apart, and with such a high percentage of people with some funds in the stock market, some sort of action will be taken.

But how long will it take before an accounting of the long term cost of fixing this financial mess will occur?

I’m awaiting the politician who admits that some will be shortchanged in the public arena as billions are leveraged to stave off the crisis. . . .

The money will come from somewhere. We just want to have a more honest accounting of the situation, of who will actually suffer, who will profit by the plan, and whether it will really fix the problems of the U.S.

Mary Sanchez, "We're Ready to Sacrifice, But Not be Suckers," Kansas City Star, October 2, 2008 (in this morning's Gazette as "Americans Ready to Sacrifice, But Not to be Suckers," p. A4).

Even Nicholas Kristof, a solid backer of the Paulson approach, acknowledges,

"[C]ritics of the bailout have reason to be furious. It is profoundly unfair that working-class American families lose their homes, their jobs, their savings, while plutocrats who caused the problem get rescued. . . .

Congressional critics of the bailout . . . should come back in January . . . with a series of tough measures to improve governance and inject more fairness in the economy: . . . remove tax subsidies on executive pay and allow courts to restructure mortgages as they do other kinds of debt. . . .

Among the strongest critics of inflated executive pay have been Warren Buffett and the late management guru, Peter Drucker, who argued that C.E.O. salaries should peak at no more than 20 or 25 times those of the average worker. (Last year, C.E.O.’s got an average of 344 times the wages of the typical worker.) . . .

C.E.O.’s hijack shareholder wealth in ways that are unconscionable. . . . [I]f [Nabors Industries] Eugene Isenberg . . . were to drop dead one of these days, his estate would be entitled to a “severance payment” of at least $263 million — more than the firm’s first-quarter net earnings.

Nicholas D. Kristof, "Save the Fat Cats," New York Times, October 1, 2008

Last night the Senate passed -- over the opposition of a full fourth of the body (25 senators) -- a "sweetened" version of the Paulson/House bill. FDIC insurance on depositors' accounts in banks would be raised from $100,000 to $250,000, and even more tax cuts are promised, among other things.

Think about it. More for the wealthy. How many of the 600,000 workers laid off this year will be helped by tax cuts? How many of your neighbors keep so much more than $100,000 in their checking account (and are so lazy or ignorant they haven't opened additional accounts elsewhere) that they really need the reassurance that it's guaranteed up to $250,000? Are House Republicans who voted for common sense (and their outraged constituents) really able to be bought with such tarnished coin?

And with the dollar continuing to drop, please explain to me how adding even more debt (from unfunded additional tax cuts) to our current national debt of $10 trillion, unfunded future obligations of $55 trillion, Iraq future costs of $2 trillion, and Paulson's added debts of $1.3 trillion, is going to make things better for future taxpayers.

There is even more reason to vote against the Senate's plan than there was to vote against the House proposal.

So where is my support from the nation's economists? Here it is. Some 200 of them, from some of the most prestigious public and private universities in the nation. I'll provide the link if you'd like to look for your own school, but my truncated listing of all the signers -- those whose last names begin with "A" or "B" -- will give you an indication of who's on board.

And what do they think of the Paulson proposal? Not much:

To the Speaker of the House of Representatives and the President pro tempore of the Senate:

As economists, we want to express to Congress our great concern for the plan proposed by Treasury Secretary Paulson to deal with the financial crisis. We are well aware of the difficulty of the current financial situation and we agree with the need for bold action to ensure that the financial system continues to function. We see three fatal pitfalls in the currently proposed plan:

1) Its fairness. The plan is a subsidy to investors at taxpayers’ expense. Investors who took risks to earn profits must also bear the losses. Not every business failure carries systemic risk. The government can ensure a well-functioning financial industry, able to make new loans to creditworthy borrowers, without bailing out particular investors and institutions whose choices proved unwise.

2) Its ambiguity. Neither the mission of the new agency nor its oversight are clear. If taxpayers are to buy illiquid and opaque assets from troubled sellers, the terms, occasions, and methods of such purchases must be crystal clear ahead of time and carefully monitored afterwords.

3) Its long-term effects. If the plan is enacted, its effects will be with us for a generation. For all their recent troubles, America's dynamic and innovative private capital markets have brought the nation unparalleled prosperity. Fundamentally weakening those markets in order to calm short-run disruptions is desperately short-sighted.

For these reasons we ask Congress not to rush, to hold appropriate hearings, and to carefully consider the right course of action, and to wisely determine the future of the financial industry and the U.S. economy for years to come.

The online letter notes, "This letter was sent to Congress on Wed Sept 24 2008 regarding the Treasury plan as outlined on that date. It does not reflect all signatories views on subsequent plans or modifications of the bill."

Here is a link to the letter, where you will find the names and institutions of the signers as "updated at 9/27/2008 6:00PM CT."

Meanwhile, as promised, here's a sampling of the names and institutions -- those whose last names begin with "A" or "B":

Acemoglu Daron (Massachussets Institute of Technology)
Ackerberg Daniel (UCLA)
Adler Michael (Columbia University)
Admati Anat R. (Stanford University)
Ales Laurence (Carnegie Mellon University)
Alexis Marcus (Northwestern University)
Alvarez Fernando (University of Chicago)
Andersen Torben (Northwestern University)
Baliga Sandeep (Northwestern University)
Banerjee Abhijit V. (Massachussets Institute of Technology)
Barankay Iwan (University of Pennsylvania)
Barry Brian (University of Chicago)
Bartkus James R. (Xavier University of Louisiana)
Becker Charles M. (Duke University)
Becker Robert A. (Indiana University)
Beim David (Columbia University)
Berk Jonathan (Stanford University)
Bisin Alberto (New York University)
Bittlingmayer George (University of Kansas)
Blank Emily (Howard University)
Boldrin Michele (Washington University)
Bollinger, Christopher R. (University of Kentucky)
Bossi, Luca (University of Miami)
Brooks Taggert J. (University of Wisconsin)
Brynjolfsson Erik (Massachusetts Institute of Technology)
Buera Francisco J.(UCLA) . . .

Consistent with the concerns of these economists are those of Senator Russell Feingold:

“I will oppose the Wall Street bailout plan because though well intentioned, and certainly much improved over the administration’s original proposal, it remains deeply flawed. It fails to offset the cost of the plan, leaving taxpayers to bear the burden of serious lapses of judgment by private financial institutions, their regulators, and the enablers in Washington who paved the way for this catastrophe by removing the safeguards that had protected consumers and the economy since the great depression. The bailout legislation also fails to reform the flawed regulatory structure that permitted this crisis to arise in the first place. And it doesn’t do enough to address the root cause of the credit market collapse, namely the housing crisis. Taxpayers deserve a plan that puts their concerns ahead of those who got us into this mess.”

"Statement of U.S. Senator Russ Feingold On Opposing the Bailout," October 1, 2008.

For the objections of other senators in the coalition of opposition see, David M. Herszenhorn, "A Curious Coalition Opposed Bailout Bill," New York Times, October 2, 2008 ("Their concerns spanned a panorama of issues: frustration over the lack of long-term regulatory changes in the legislation; alarm that $700 billion in taxpayer money would be at risk; anger that the Treasury secretary would not be subject to more stringent oversight; skepticism that executives of firms that seek help would face limits on their pay; and dismay that such an important bill was being rushed through Congress. And, perhaps most pointedly, they expressed skepticism that the bailout proposal would be able to restore liquidity to the credit markets, prevent the collapse of additional banks and safeguard the economy from a long recession.").

There are those who say (to me, and to other critics of what Congress is doing), "Now look, I understand you're angry, that you don't like this plan. But we have to do something. You can't just oppose the only plan we have. If you don't like it so much, tell me what you think would be a better plan."

OK. And I'm about to tell you what would be a better plan.

But not before I observe that I don't really think that's my responsibility. I'm with the secretaries with more than one boss who post the sign on the wall, "Your failure to plan does not constitute my emergency." It's like the profligate friend who wants to borrow money "because otherwise the electricity is going to be cut off." And you're thinking, (a) why didn't you think about that when you engaged in that last excessively expensive bit of discretionary spending (or trip to the casino), and (b) why didn't you let me know this was coming more than the day before the shut-off is going to occur?

Those who will bear the burden of this Wall Street bailout did not create the problem. It's not their responsibility to come up with a solution.

But because they (and I) will continue to be berated by the perpetrators unless we solve it for them, here's an idea.

I.
It's not a theoretical, ivory tower approach. Not only did it work for another country -- it was actually the approach taken by Paulson with Fannie Mae, Freddie Mac and AIG! So please tell me: Why has he now suddenly abandoned this approach?

It's not as if no other country has ever dealt with a similar financial crisis, or that there is no other approach than that of Secretary Henry Paulson. The $700 billion we're talking about represents some 5% of our GDP. In 1992 Sweden put 4% of its GDP into its banks. (They had run into trouble for much the same reason as ours: "Financial deregulation in the 1980s fed a frenzy of real estate lending by Sweden’s banks, which did not worry enough about whether the value of their collateral might evaporate in tougher times," as the Times' Carter Dougherty reports, but they didn't use taxpayers' money to buy up "toxic debt." Dougherty continues:

Sweden took a different course than the one now being proposed by the United States Treasury. And Swedish officials say there are lessons from their own nightmare that Washington may be missing.

Sweden did not just bail out its financial institutions by having the government take over the bad debts. It extracted pounds of flesh from bank shareholders before writing checks. Banks had to write down losses and issue warrants to the government.

That strategy held banks responsible and turned the government into an owner. When distressed assets were sold, the profits flowed to taxpayers, and the government was able to recoup more money later by selling its shares in the companies as well. . . .

[T]he final cost to Sweden ended up being less than 2 percent of its G.D.P. Some officials say they believe it was closer to zero, depending on how certain rates of return are calculated. . . .

A few American commentators have proposed that the United States government extract equity from banks as a price for their rescue. But it does not seem to be under serious consideration yet in the Bush administration or Congress.

The reason is not quite clear. The government has already swapped its sovereign guarantee for equity in Fannie Mae and Freddie Mac, the mortgage finance institutions, and the American International Group, the global insurance giant.

Putting taxpayers on the hook without anything in return could be a mistake, said Urban Backstrom, a senior Swedish finance ministry official at the time. “The public will not support a plan if you leave the former shareholders with anything,” he said. . . .

Sweden formed a new agency to supervise institutions that needed recapitalization, and another that sold off the assets, mainly real estate, that the banks held as collateral.

Sweden told its banks to write down their losses promptly before coming to the state for recapitalization. . . .

Then came the imperative to bleed shareholders first. . . . Peter Wallenberg, at the time chairman of SEB, Sweden’s largest bank . . ., the scion of the country’s most famous family and steward of large chunks of its economy, heard that there would be no sacred cows.

The Wallenbergs turned around and arranged a recapitalization on their own, obviating the need for a bailout. SEB turned a profit the following year, 1993. . . .

[T]he agency had mostly fulfilled its hard-nosed mandate to drain share capital before injecting cash. When markets stabilized, the Swedish state then reaped the benefits by taking the banks public again.

Carter Dougherty, "Stopping a Financial Crisis, the Swedish Way," New York Times, September 22, 2008.

II.
Are you really going to try to convince me that there are no American "Wallenbergs" out there who might come up with similar solutions if they knew their share of the $700 billion would be accompanied by a loss of ownership? There is a "market" out there as well as taxpayer money. J.P. Morgan bought the failing Bear Stearns. "In the midst of the subprime crisis, Buffett said during a media interview in June that he sees investment opportunities in the subprime market." He just put $3 billion into General Electric. Bank of America bought Merrill Lynch when it was near bankruptcy. Wells Fargo just bought Wachovia. There have been others.

Maybe the market, alone, is not enough to pull us out of this. But shouldn't that option at least be exhausted before loading an additional $700 billion (or more) debt on our great grandchildren?

III.
Ireland has just come up with its own innovative approach (though not unprecedented, less satisfactory, and far more controversial), characterized by The Daily Telegraph as "the most dramatic and comprehensive bank bailout in Europe since the Scandinavian rescues of the early 1990s." The Irish Times, from which this quote comes, has published a summary of the response of many of the world's great newspapers to its government's essentially bank loan guarantee plan. "World View," Irish Times, October 2, 2008. For the Financial Times' take on what's going on in Ireland this week (as well as the British government's response) see Andrew Hill, "Guarantees Go Only So Far," Financial Times, October 2, 2008.

IV.
And Michael Moore (yes, that Michael Moore) has some solid suggestions among the ten in Michael Moore, "How to Fix the Wall Street Mess," October 1, 2008.

V.
Now I'm not about to join those "I'm still angry," PUMA, former-and-for-always Senator Hillary Clinton supporters and "go Republican" on you. But I've always been more interested in ideas than ideology, proposals than partisanship, and when I find a Republican with a better one I'm not afraid to say so.

Though I must say it gives me some sadness to have to say, this close to election day, that I think Dr. Mariannette Miller-Meeks, the Republican opponent of my Democratic Congressional Representative, Dave Loebsack, has the better position on the Wall Street bailout. See, on her Web site, "Congress Must Set Aside Politics, Address Root Causes of Financial Crisis," September 30, 2008.

Not only do I not support everything she says, I have to candidly acknowledge I don't even understand everything she says. But I understand and agree with most of it, and offer it in the context of this blog entry as, at a minimum, one more response to those who argue that no one is permitted to dislike the Paulson approach unless they can come up with some other alternative. Well, here is yet one more alternative.

"We need to quickly stabilize the financial system with the least cost to the taxpayers. . . .

She said Congress should remove language from Community Reinvestment Act that encouraged excessive risk-taking by Fannie Mae and Freddie Mac and authorized the development of bundled mortgage debt obligations creating this morass and passing the risk onto others. Miller-Meeks advocates temporarily suspending mark-to-market accounting so that banks can stabilize their accounts instead of writing down good loans that will be repaid in full.

"Home owners who are dutifully paying their mortgages on their primary home and have been honest in their application, should be protected with new mortgage product or stabilization of the housing prices. We should penalize those responsible for the losses and keep current executives in place without golden parachutes. Unfortunately, those who benefited most are already gone from those institutions," she said. . . .

Miller-Meeks said the federal government does have an appropriate role in the crisis, including purchasing some institutions and securities at fair market value and selling them at fair market value to the benefit of taxpayers. She believes all proceeds from the eventual sale of such assets should pay down the national debt or provide a tax dividend to taxpayers. . . .

"Steve King is absolutely right when he says doing 'something' is not enough; we have to do the right thing. That means we need to approve a plan so that Wall Street won't expect a bailout every time they make the wrong decisions," she said. "To paraphrase Martin Luther King, Jr., we can't afford socialism for the rich and raw capitalism for the rest of us. Unfortunately, David Loebsack doesn't seem to understand that or the real-world challenges facing the people he's supposed to represent."

Miller-Meeks favors allowing the Federal Deposit Insurance Corporation to ease capital requirement for banks so they can ride out the current credit crunch. She also believes the Securities and Exchange Commission should modify fair value accounting so assets aren't considered worthless during a market panic and instead can be valued on the basis of their true economic value. She also favors development of a plan to let private investors fund the bailout through guaranteed recovery bonds or to set up insurance programs to ensure Wall Street bankrolls its own recovery. . . .

So there you have it. There are better ways to deal with our financial problems, at a minimum there are alternative ways that should be fully explored before rushing down the dangerous path Congress has chosen, ways that consider the plight of the unemployed and homeowners, ways that promise a little greater likelihood of a return to taxpayers, ways that don't reward those who created the problem, and ways that don't perpetuate their inclination to make short-term greedy profit by putting long-term probable risk onto taxpayers.

The route the Senate -- and perhaps on Friday (October 3rd) the House -- are taking (particularly given their role in criminally removing regulation from the industry) is not necessary and is certainly not the only, inevitable, approach; it's just the despicable approach.

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