Some years ago, I wrote a piece about Bombardier receiving tax-payers subsidies. In that piece I suggested some rules that should be put in place for such loans and subsidies. As we are about to grant similar multi-billion handouts to major corporations, I thought I would repeat the rules as to how we should deal with the current crisis.
My own position is that no corporations should receive public funds, period. However, until we straighten out our economy to be self-supporting, I would be prepared to lend affected industries the money they need, but only under certain conditions:
- The company cannot issue dividends or share buy-backs or any other kind of profit-sharing until the loan is repaid in full;
- No executive bonuses or similar payments to be paid until the loan is fully repaid;
- No executive salaries or other payments to be increased until the loan is fully repaid;
- If the company goes bankrupt (or similar), the taxpayer loan is in first place for repayment after wages and salaries.
Who on earth could object to this? It gets the company the cash it needs and gives executives every incentive to repay the taxpayer as quickly as possible. I would push this idea for any and all companies seeking tax-payer assistance.