House Democrats introduce a resolution opposing any federal bailout if an AI bubble bursts
The release has the resolution's specific commitments and the lawmakers' and endorsing groups' reasoning in their own words.
Rep. Greg Casar, chair of the Congressional Progressive Caucus, and Rep. Maxine Waters, the top Democrat on the House Financial Services Committee, introduced a resolution on Oct. 29 warning of the economic risks of an AI-related asset bubble and opposing a bailout of companies or executives if it collapses. Eleven other Democrats joined them.
The resolution says AI-related firms hold "trillions of dollars in debt, much of which is raised in opaque and unregulated private credit markets," and that the stock market's price-to-earnings ratio is almost as high as at the peak of the 1990s tech bubble. Its sponsors commit to opposing emergency lending or capital injections for insolvent AI firms and "golden parachutes" for executives, and to backing direct help for workers and retirees, such as unemployment insurance and automatic stabilizers, in a downturn.
"A.I. companies that fail should go bankrupt," Casar said. Groups including the American Federation of Teachers, Americans for Financial Reform and the Future of Life Institute endorsed it. A resolution states a position; it does not change the law.
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Troubled Asset Relief Program
After exploring Reps. Casar, Waters Lead Democratic Resolution Opposing A.I. Bubble Bailout for Big Tech, Commit to Protecting American People Instead | Press Releases | Congressional Progressive Caucus, the 2008 rescue the sponsors keep pointing to is Troubled Asset Relief Program.
Covers TARP, the 2008 US government program to buy toxic assets and equity from financial institutions during the subprime mortgage crisis, the bailout the resolution's sponsors cite.
Wikipedia · Wade · 5 min
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