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THE STALLED DEAL.
The Bailout of All Bailouts just got voted down, 228 to 205. There’s the expected partisan finger-pointing but House leaders will schedule another vote as soon as they can convince twelve of the nay-sayers, from either party, to approve.
Wild card: angry voters who go to the polls in five weeks. Conservatives don’t want government to take over the free market. Liberals don’t want Wall Street fat-cats to get a free ride. And the more the public focuses on the bill, the angrier they become. (Polls show about a third of Americans in favor, a third opposed, and a third undecided; the percent in favor is growing slightly, but the percent against is growing even faster.)
Wild card on the other side: The Dow is dropping precipitously. Roughly half of all American families have some retirement money in the stock market. And even if they don’t own shares of stock, an increasing number are feeling the pinch of an economy gradually grinding to a halt. (This week’s employment report will not be very encouraging.)
Don’t expect easier sailing in the Senate. Fewer than a third of the Senate is up for reelection on November 4, but they’re all hearing from angry constituents.
Prediction: A scaled-down bill will be enacted by the end of the week. It will provide the Treasury with a first installment of $150 billion. Treasury can use it to back Wall Street’s bad debts with lend no-interest loans of up to two years, until the housing market rebounds. Or to invest in Wall Street houses directly, in exchange for stocks and stock warrants. There will be strict oversight. Congressional leaders will promise further installments, but with conditions calling for limits on salaries and relief to distressed homeowners.
--Robert Reich
Originally posted on Robert Reich's Blog
COMMENTS (4)
Um, can we have a moment here? This paragraph begs for some follow-up analysis:
Wild card on the other side: The Dow is dropping precipitously. Roughly half of all American families have some retirement money in the stock market. And even if they don’t own shares of stock, an increasing number are feeling the pinch of an economy gradually grinding to a halt. (This week’s employment report will not be very encouraging.)
If the next "bailout" plan does not have an easy, obvious, accurate, and enforceable answer to the question, "Yeah, but does the proposal ACTUALLY ADDRESS THE GODDAMN PROBLEM?" exactly how fucking persuasive does anyone in economic-expert land think such a bailout proposal is going to be to, you know, actual voters?
Because if there's one thing worse than Congress sitting on a few hundred billion dollars instead of fixing a problem, it's Congress blowing a few hundred billion fucking dollars on the same goddamn people who got us into this mess.
You may not be able to find more than one voters in three who can recognize the phrase, "opportunity cost," but you can be pretty goddamn sure that if there's an argument for a bailout, "Well, we *HAD* a few extra hundred billion dollars, so we gave it to some guys in return for some magic beans," it's not exactly going to be *more* popular.
Posted by: Chris | September 29, 2008 11:19 PM
Ditto Chris! Mega Dittos!
Posted by: Rush | September 30, 2008 2:13 AM
No one argues that the bailout will solve the problem. All it does is tone down the hysteria by giving the appearance that the problem is under control. It is not and all of the dire predictions of what will transpire if there is no bailout will probably happen whether its Xmas for big money or not(downsized a little to eliminate the spin). Let the market wreak its revenge and take care of the people who will be hurt--mortgage work-outs, jobs, health insurance, social security, etc. And pay for it out of the defense budget.
America is lost and needs to find its way and I don't mean born again.
I found this in a search for the vote on the bill so I could see how my rep voted. Does anyone know where it is?
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