Four questions about the bailout bill failure
1. I'm not altogether sure this vote was a repudiation of the moneyed classes in this country. But what is it other than a repudiation of President Bush by 2/3 of his own party and Speaker Pelosi by 2/5 of her own party — and a wider repudiation of the White House, the Congressional leadership of both parties, and both major-party presidential candidates? Unlike many previous instances — most notoriously the creation of the Medicare prescription drug program — Bush couldn't use the sheer force of arm-twisting to get his way with Republicans. And at last, a substantial minority of Democrats have had a bellyfull of Speaker Pelosi rolling over on the theory that going along with Bush will "give the Democrats an issue" on which to run against Republicans.
2. In an era where significant legislation is snuck in as amendments to completely unrelated legislation, doesn't the bailout bill take the cake? Its actual title had nothing to do with bailouts. It's right there on the House website with the roll call: "To amend the Internal Revenue Code of 1986 to provide earnings assistance and tax relief to members of the uniformed services, volunteer firefighters, and Peace Corps volunteers, and for other purposes." Other purposes, indeed. Was this a blatant attempt to get the bailout passed on the assumption that a few utterly clueless members wouldn't know what they were voting on, and would vote "yea" simply because the bill had a motherhood-and-apple-pie title? Breathtakingly cynical.
3. Why didn't George W. Bush feel he could resort to his usual gambit of agreeing to a compromise to get something passed in Congress, and then use one of his infamous "signing statements" to turn black into white and day into night, simply changing the law by executive fiat to what he originally wanted? Would the howls of protest been too much? This is encouraging.
4. Assume the theory that the President's Working Group on Financial Markets, a.k.a. the Plunge Protection Team, actively intervenes to prop up the stock market on days it falls precipitously. Isn't it then a logical corollary is that it would either allow or engineer a precipitous drop, e.g. yesterday, to scare the hell out of people with 401(k) plans and goad them to pressure their members of Congress to pass the bailout on the next go-round?
In any event, it will be interesting — in a horrific train-wreck kind of way — to see what differences emerge between the new bill and the old one. For rest assured, there will be a new one.
Update: The Center for Responsive Politics finds that, "Members of Congress who defeated the emergency package Monday have collected nearly $590,000 from the industries most affected, on average, but the bill's supporters received $883,000." That is, supporters got half again as much as opponents. But in the end, it wasn't enough. Maybe this was a victory over the moneyed classes after all. (And I hope for this audience it's understood that "moneyed classes" means those who've come about their riches via the route of government-abetted finance, not legitimate entrepreneurs who've come about their riches via hard work. But for the sake of newcomers, I guess it doesn't hurt to mention…)