No Bailout — Holy Cow!
Leave it to the House to have the guts to say what’s on everyone’s mind.
Yesterday’s rejection of the proposed bailout of…well…everything but insurance giant AIG (been there, done that) was a complete shock. The Dow dropping another 700 points went right along with it. But what does it mean?
First, it’s a giant vote of no confidence — no confidence in this President’s economic policy, and no confidence in the people who shaped that policy. Both sides want to blame the other for the failure and resulting crash, but if you look at the breakdown of votes, both parties are strongly represented on both sides of the issue.
Finally — something to bring this nation together….
The pressure put on lawmakers by their constituents cut close to the bone. The bailout may be necessary to avoid the New Depression, but with a secretary of the treasury asking for immunity from investigation, prosecution, and pretty much all oversight — sure, he took that part out after a while, but what voter/taxpayer isn’t going to raise a stink after hearing that?
It’s not only a mismanaged economy, but also a mismanaged PR campaign.
Both presidential wannabes are calling for us to regroup and try again before it’s too late (while Ms. Palin heads to Walmart for a few more cases of drinking water and ammunition). That’s interesting in and of itself — this is a wildly unpopular issue, and if they really thought we could get away without it, one or the other would jump on the no-bailout train to victory.
Why aren’t they? Because not doing anything is what got us here, and in order for increased government regulation to work, we need to preserve the stuff we regulate.
Bill Clinton had some really interesting takes last week on the Daily Show — most notably, he believes that if we buy up this paper and use the resulting power to rewrite bad mortgages and keep people out of foreclosure, the taxpayers will end up making money on the bailout — and he cites a similar bailout at the beginning of the last century as evidence. Essentially, use the big bailout to bail out the little guy, and consumer confidence increases and the market works again.
I seem to remember someone saying something similar not that long ago….
The good news is, we don’t actually have to act now — our lawmakers don’t have to vote on yet another bill they haven’t had time to read. The turmoil on Wall Street is Wall Street’s own enormous, ugly baby, and the people most hurt by this are the people who benefited from the influence peddling that got us here.
For now. But there has to be some real economic stimulus, and another fat government check for all of us isn’t going to make it happen.
Forget Bailing Out; Just Move To Greater Boston
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