THE CENTER FOR INTELLIGENCE STUDIES

FROM THE CENTER FOR INTELLIGENCE STUDIES

Sept. 29

The Center for Intelligence Studies today called upon the Congress of the United States to reject the Bush Administration's $700 billion Wall Street bailout, and instead draft a plan that will 1) insure liquidity within the financial system and 2) facilitate the normal bankruptcy process so that insolvent firms may reorganize under existing bankruptcy laws.

"The real issue is ownership," said CFIS Chairman Charles S. Viar. Under existing bankruptcy laws, ownership of bankrupt firms passes from the stockholders - who have failed to exercise proper shareholder oversight - to the creditors.

Under the Bush bailout scheme, stockholders would retain ownership of the firms they failed to supervise while taxpayers will be stuck with the tab.

"The Bush plan represents a radical departure from the Free Enterprise System, creating a quasi-socialist order in which profit remains private and loss becomes public...

"Apparently, Mr. Bush's philosophy is one of "Heads the global corporations win, tails the American taxpayers lose."

Noting that national security depends upon a healthy and vibrant economy, Mr. Viar further stated that current financial crisis posed a direct and immediate threat to the nation's security and for that reason should be addressed as such.