Second Bailout Package

FED Chairman Ben Bernanke is currently testifying on Capitol Hill and giving his blessing to a second stimulus package should Congress deem it appropriate to pass such a measure. He is stressing that any package should focus on freeing up the credit market. In addition, Mr. Bernanke is encouraging Congress to ensure that any package be fashioned in such a way so as to not unduly burden the budget deficit. (Source: CNBC)

My understanding is that the first package (somewhere between $700 billion and $850 billion) was inclusive of the $250 billion that the government is in the process of funneling into the banks. Roughly half of that money will go to nine major banks with the other half being distributed to smaller banks. This action and the remainder of the first package was also intended to free up the money supply and/or credit.

My questions are as follows:

Where is the remainder of the money from the first package going and/or what are the remaining details of the first package? (There is talk of writedowns of principal on mortgages, restructuring of mortgages to certain homeowners and the purchase of certain debt on the open market.)

Should we not allow the first package to be fully implemented prior to passing a second package, or, at minimum, have a clear explanation as to why the first package will be insufficient?

How are we going to pay for these packages, particularly if the government buys bad debt at above market prices? Are we simply delaying the inevitable with regard to the cyclical nature of the economy, and thus causing a larger financial crisis in the not-so-distant future?

How long does the government intend to be an owner/investor in major financial institutions which have previously been the province of the private sector (excluding Fannie Mae and Freddie Mac)?

In my opinion, most importantly:

With respect to any writedowns of principal on mortgages, is this going to be done uniformly for all homeowners and, if not, what will protect the equity for homeowners who are excluded from the writedowns? Will the excluded homeowners not immediately lose equity as a result of writedowns on principal of similarly valued comparable properties?

In the event that these proposed writedowns are not uniform and certain homeowners are excluded, this will be tantamount to a vast redistribution of wealth. Whether one agrees with such actions by the government is not my concern for purposes of this blog, but let's be clear on what the intended and unintended consequences of these action will be on the economy as a whole, certain classes of people and you, the reader of this blog.