Bailout fails

Posted by Josh Rosenau on September 29, 2008
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With a majority of Democrats in favor of it and a majority of Republicans against it, the financial bailout plan negotiated over the weekend failed in the House.

Not being an economist, I can’t say that the plan was good or bad, but the consensus of smart people I’m reading seems to be that it was good enough. Allowing it to fail was foolish not just because it created the largest drop in the Dow ? bigger than that following the 9/11 attacks ? but because the best excuse the Republicans could come up with for voting against it was that Nancy Pelosi hurt their feelings. There are plenty of reasons to be skeptical about this or any bill giving away billions of dollars to the same people who screwed things up in the first place, but Republicans cited none of that.

In any event, this is a catastrophic setback for John McCain. Last week, he stupidly inserted himself into the process. First he made a lot of noise about suspending his campaign to fly back to DC. Then he sat largely silent in meetings, speaking up only once, and that was to give tepid endorsement to a splinter plan from conservative House Republicans which would’ve left taxpayers holding the bag if the financial system collapsed, but which offered no upside to taxpayers if the bailout succeeded. Republican leadership had been working hard to get their conservative members to shelve that idea, but McCain’s endorsement sent everyone back to the barricades, and laid the groundwork for today’s fractured vote.

Meanwhile, McCain spent the time before the House vote claiming credit for the imminent victory. At a rally in Ohio, he declared “it?s not my style to simply phone it in.” On Sunday, Lindsay Graham struck the same note, telling Fox News Sunday that “John didn?t phone this one in. ? You can?t phone something like this in. Thank God John came back.”

Alas, well-documented accounts of McCain’s travels over the tail-end of last week found that he in fact did his work on the bailout by phone. On Saturday, he “could be seen in his car talking on his cell phone.” Later, a spokesman “told reporters that Mr. McCain would not go to Capitol Hill on Saturday but would make phone calls to try to push the deal along.” Asked why McCain didn’t meet negotiating members of Congress in person, the spokesman insisted “he can effectively do what he needs to do by phone.”

McCain has huddled away from the press since the vote. This is simply not the man I want running my country.

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Comments

  1. #1 Michael Ejercito
    September 29, 2008

    Of course, it should be noted that the bailout could have passed without a single Republican vote. And yet it failed, despite sixty-five Republicans voting for it.

    How did Speaker Pelosi fail to appease the concerns of the ninety-five Democrats who voted against the bailout?

  2. #2 The Ridger
    September 29, 2008

    Of course it could have, but they’re not the ones saying they would have voted for it if only she hadn’t been so mean. That’s just an astonishing thing to say.

  3. #3 SimonG
    September 29, 2008

    I caught a bit of Pelosi’s speech on the TV, and I’ve read the transcript of the whole thing and whilst I agree that it seems rather petty of the Republicans Pelosi herself didn’t help matters. She didn’t sound to me like someone who wanted this to pass. Her words seem very partisan: anyone who agreed with them would be saying that the Republican administration is effectively over.

    If she was so keen to have the bill pass, she should surely have made a much more conciliatory speech, talking up how everybody had reluctantly agreed on the necessary measures – the least worst option – rather than how it was all the fault of Wall Street and Republican administration, with the Democrats selflessly trying to save their bacon.

  4. #4 Daprez
    September 29, 2008

    The final vote results for roll call 674 is an interesting read. Boyda joins the Republican majority and votes no.
    Is the race in KS 2nd Congress that close? Last I saw, Jenkins was still trying to get name recognition in her neighborhood.

  5. #5 Patrick
    September 29, 2008

    @ #1

    They want the republicans to get on board so they can spread the blame around and keep it out of the election talk. It’s deeply unpopular and making it require their support puts it out of play. I think it also sets up future discussion about entitlements, health care, etc. “You voted for socialism in the past, you’ll bail out wall street but not insure kids?” That kind of thing. Calculated as all get out.

    And Pelosi was way out of line in her speech, but she’s always doing that crap. It’s petty for the republicans to just harp on it. Plays well to their base.

    As far as passage, I don’t think the president, Paulson, or congress have done a good job of selling it. The Public is not convinced this is the right thing to do.

  6. #6 Josh Rosenau
    September 29, 2008

    There’s a perfectly plausible case to be made that the bill is bogus. You might think it’s too punitive, or not punitive enough. That the taxpayers’ money shouldn’t be plowed into the fields Wall Street salted. Or that George Bush and his appointed hacks don’t deserve to be trusted to give away that much money to their buddies in high finance. And I’d wager that the minority of Democrats who voted “no” would give such explanations. And that’s fine. They may well be right.

    But that’s not the Republican line. The Republican line is “there were enough votes on our side, but then Pelosi was mean so we decided to vote against a bill we would otherwise support.” In other words, endangering the global economy out of spite. And that is utterly irresponsible. If they support the bill on its merits, then they should vote for it. And they should get used to the idea that, like the vast majority of Americans, Nancy Pelosi thinks George Bush has been a reckless and incompetent leader who bears personal responsibility for the catastrophe we’re watching unfold.

  7. #7 Art
    September 30, 2008

    This was a GOP bill written by the GOP run executive branch. The Democrats were only allowed to slightly modify the bill.

    Seeing as that it was a GOP bill backed by both the executive and the GOP house leadership and McCain it is shocking that the best they could do was less than a third of the GOP legislators. What happened to GOP party discipline?

    In comparison Pelosi was able to get almost two thirds the democratic side to vote for this GOP created bill.

    The claim that the GOP legislators got their feelings hurt and so didn’t go along is BS. The GOP has called Democrats every name in the book. Including traitors and terrorist sympathizers. And now they have the gall to claim that they couldn’t do their job because they got their feelings hurt?

  8. #8 Dean
    September 30, 2008

    More news this am – Newt Gingrich was running around to Republicans right up to vote time, lobbying against the bill. The leader of the Congressional Black Caucus stated they voted against it because it didn’t have bankruptcy protection.

  9. #9 eddie
    September 30, 2008

    The real scandal is the dems that supported the bill.
    It’s not extreme conservatism to object to taxpayers picking up the tab. You just need to be a taxpayer. What else will your family do without to pay for this?
    Also, the ‘bailout’ money is not guarranteed to help anyone in danger of losing their home or job, but their boss will get a golden parachute.
    It’s a heist.

  10. #10 Involved1
    September 30, 2008

    As the presidential campaign moves (“forward” would not be accurate here), there’s an elephant in the room. Heck, there’s a herd of them!

    But to me, one stands out as the clear leader: “With our nation’s myriad devastating problems (see 5k+ Americans killed in the ‘Mission Accomplished’ war, the economy, health care, foreign relations, terrorism, the Middle East, Russia, etc.) why would anyone want to be President? For the power and the prestige? Sure. But doesn’t it require a monumental, extra-terrestrial ego for any sane person to think he/she can keep on top of everything, much less solve anything?

    While the thought of McCain as president is bad enough without adding Palin into the mix, I wonder if even a modern-day Lincoln, FDR, or Truman would be able to cope.