Chris Dodd and Jim Webb: American Heroes

At heart, America has really always been dirigiste, in the tradition of Alexander Hamilton, Abraham Lincoln and Henry Clay.

Thank God for the continuation of that tradition today by Senator Chris Dodd, who demands legislative changes to the Treasury proposal in order to establish a board to oversee its execution, require that monthly reports including financial statements be submitted to Congress, and place caps on executive compensation at institutions participating in the bailout, among other measures, even including a public stake in each such institution.

Senator Dodd also wants to see provisions to assist struggling homeowners, including placing into affordable housing funds twenty per cent of any profits earned from the purchase and sale of assets by the Treasury Department under the bailout.

Can you imagine any frontline British politician saying any of that, never mind all of it? Even Jon Cruddas could only do it if he did not join the Cabinet after all.

Meanwhile, the man who should have been Obama's running mate, Senator Jim Webb of Virginia, has written to Dodd (PDF), also to urge that any legislation granting the federal government the authority to purchase $700 billion in bad assets include a strengthened regulatory structure to prevent future market instability, and a cap on executive compensation in companies being rescued by the American taxpayer. Thus speaks Reagan's old Navy Secretary, a staunch cultural conservative. Of course.

Says Webb, “It is inarguable that the regulatory structure now in place has not protected either our financial system or the U.S. taxpayer. The administration is asking for an unprecedented rescue of the most profitable institutions in America with the taxpayers footing the bill. No bailout should occur without a return to increased regulation.”

Webb also insisted that, if taxpayers' money is being used to bail out an American company, the limit on compensation to the company's executives must be capped at the salary of senior federal government employees. (Again, try and imagine any British politician allowed on the air saying that.)

“We must ensure that executive compensation in those companies being rescued by American taxpayers is reasonable in scope, until this crisis has passed and the American taxpayers have been made whole,” said Webb.

Webb has been warning for several years about the excesses of Wall Street, identifying them as a grave risk to America's economic position in the world community, and as grossly unjust to ordinary workers.

“Executive compensation in the United States is outrageously out of proportion with any other period in our history, and with any other major country in the world today. Unless we insist on this basic principle of fairness, we will rightly risk the condemnation of our fellow citizens. Further, as the government purchases securities using this new authorization, it must do so at true market value or less. To do otherwise would subsidize those who precipitated this crisis,” said Webb.

Well, he is far too generous at least to this other country there. But apart from that, we cannot possibly have some of this too soon over here.

You know what you have to do.