Do something, Congress
Yesterday was a rotten day for this country, and there was no shortage of spoilers.
Those include the House members who voted down the bailout plan. If their attitude is to let the market solve its own problems, well, they should have seen some immediate indication that's not going to work. Let's hope today brings a turnaround on Wall Street, but the mood isn't optimistic.
Some Republicans blame Speaker Nancy Pelosi for issuing partisan remarks before the vote. OK, she was wrong. She's speaker of the entire House, not just leader of the Democrats, and she should have set a tone of bipartisanship.
But come on. Did some Republicans really shift from support to opposition because of something Pelosi said? If they did, what kind of statesmanship is that?
Yeah, Democrats aren't accepting their share of blame for this fiasco. Some of them opposed attempts at regulation of Freddie and Fannie years ago because they so badly wanted to boost homeownership by people who should not have been able to borrow so much money. But Republicans shouldn't pretend they've been champions of regulation and watchdogs on Wall Street.
Some Democrats say John McCain fouled the deal by shining the light of presidential politics on the deliberations. That's baloney. If presidential politics were a primary consideration, House Republicans wouldn't have pulled the rug out from under McCain. This failure hurts his campaign.
Lots of people blame Henry Paulson. The roof is caving in, and he was saying the floor would collapse as well if a deal wasn't approved immediately. Did his statements cause yesterday's panic? Maybe they contributed.
Some say President Bush didn't explain the plan adequately to the American people. They didn't understand how their own fortunes would sink if Wall Street tumbled. I agree. I hope his second attempt this morning has a better effect but, unfortunately, his credibility level is practically below ground at this point.
Congress does have to try again. Those who voted no, like Howard Coble, ought to spell out what they need in order to vote yes and help make it happen.
By the way, I've got a call in to Teresa Sue Bratton to find out how she would have voted.
Yeah, calls from constituents were running heavily against the plan, from all across the country. Sometimes Congress has to do what seems to be necessary even if the remedy isn't absolutely certain and is definitely unpopular.
We can't stand many more rotten days.
If financial institutions like Wachovia can teeter, leaving the great city of Charlotte in likely distress, no community is safe.
Addendum: Sen. Dole would have voted against the measure presented to the House yesterday but is working on improvements she could support, aide Brian Nick tells me.
Update, 2:20 p.m. Teresa Sue Bratton, Howard Coble's Democratic opponent, returned my call from this morning. She would have voted FOR yesterday's bailout proposal.
Some of her comments:
"I believe it was the best bill available at the time."
The financial crisis already is being felt on Main Street, and things could become worse if nothing is done.
She has no reason to doubt the response to Coble's office, which said most callers opposed the plan: "A number of people in the district see this as a bailout for failed policies in the financial markets," Bratton said.
But she's also heard from people who want something done to restore liquidity and stability to the markets.
Now, she says leaders in Washington have to look at their options, analyze the options and move forward.
Comments (7)
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Henry Paulson?. I blame Pat Paulson. If he would have worked harder to get elected President back in "68, we likely wouldn't be in the mess we're in now.
Posted on September 30, 2008 10:16 AM
Do something, Congress
Yesterday was a rotten day for this country, and there was no shortage of spoilers.*Doug
Naw! Great Day, the American people said no to the Federal Reserve system and save the day from the Greedy Banks and the Wall Street Pozi Scam.
We can't stand many more rotten days* Doug
Sure you can Doug! The revolution is just starting and stop putting your faith in the establishment funny money paper currency system.
Posted on September 30, 2008 12:51 PM
Yo Doug, looked for you at the Central game last pm-a thrilling come-from-behind-win. Hopefully you're not letting the torch go out.
Posted on September 30, 2008 4:28 PM
Yo Doug, looked for you at the Central game last pm-a thrilling come-from-behind-win* SS
Speaking of Stadiums! The Bailout and Meltdown has finally reach Charlotte. This was what Doug fear![If financial institutions like Wachovia can teeter, leaving the great city of Charlotte in likely distress, no community is safe]
According to the Carolina Panthers today, Their Bank of America stadium change the name of the Stadium 4 times today. At noon, It became the Wachovia Baptist Stadium and 10 minutes later it was call the Cito Funding Center of the Universe Stadium. At 3 pm it was change to the Dubia International Stadium for Soccer and English Football. Finally! At the close of the Stock market, The Stadium name was change to the Federal Reserve System of Charlotte with a sign posted at the ticket boxes.
" Warning! This is government property, Tresspassers will be shot on sight!"
Homeland Security
Posted on September 30, 2008 8:14 PM
I'm glad it failed, and I hope it fails in the Senate and again when it's brought before the House. How can you question our Representatives' statesmanship when they actually voted WITH their constituents' desires? For once the folks we've elected to represent us in Washington have heeded our collective opinion and voted that piece of garbage down.
It had nothing to do with Pelosi's partisan comments, unless she angered some of her fellow Democrats. Alone, they could've mustered the numbers to pass it, but only 60% of House Democrats voted for that nonsense.
We are a free-market economy, not a Socialist state whereby the government runs everything. In fact, I'd wager that its the Socialistic programs that were forged years ago that are largely to blame for the current crisis we're facing. Take a look at the creation of Fannie and Freddie, as well as the Community Reinvestment Act, which essentially FORCES banks into lending money to unqualified prospects. Look at the mismanagement within Fannie and Freddie - they've been brought before House committees before about their questionable book-keeping practices. Former CEO Franklin Raines was essentially ousted for cooking the books to get himself paid by the SEC and OFHEO, yet one of our presidential candidates looks to him for advice? Even more curious, the top three politicians receiving campaign contributions from Fannie were Chris Dodd, Barack Obama and John Kerry, all Democrats who vigorously defend the mismanagement that occurred within Fannie and Freddie, partly to blame for our current economic situation.
So, no, Doug - we've already witnessed how well government intervention works, so let's give the original basis for our economy and society another chance and send this hogwash back to the garbage can where it belongs.
As for Wachovia, you wrote:
"If financial institutions like Wachovia can teeter, leaving the great city of Charlotte in likely distress, no community is safe."
Please. First, "Wachovia" was on a slow downward spiral ever since it's acquisition by First Union. Then, they made it their goal to expand like crazy and gobble up banks wherever they could, essentially stealing a page from BofA's infamous playbook, but didn't clean house in the same manner that BofA does, so they became bloated. Who cares, though, right? We're still making money hand over fist, so let's make more and buy a big mortgage lender in a thriving economy where houses are appreciating at record rates! Wachovia buys Golden West, and shortly thereafter the bubble bursts. Wachovia is saddled with all these ridiculous Pick-a-Payment (seriously, who could've EVER thought that was a good idea) mortgages and the defaults and foreclosures piled up. Banks aren't in the business to be landlords or property owners, so the losses started piling up in a hurry. That is why Wachovia (essentially) failed. I'm not saying other banks are immune to it (keep an eye on National City), but Wachovia had numerous extenuation circumstances that most other banks will not face. I think it will be the last major bank to "fail" and we'll only see a few smaller regional banks close their doors in Florida, California and the Rust Belt.
The bailout, erhm... rescue, or whatever they want to call it now is a bad idea, plain and simple. What's worse is that the American people know it this time. The economy needs to run its course naturally, and to do that, the financial institutions that made the risky bets NEED TO FAIL. What kind of message does that send to businesses in the future if the bailout passes? Sure, make all the risky bets and win big in the short term. When the bottom falls out (again), Uncle Sam and his new Socialist society will be there to save your butt again! Sharing the profits you made in the short term? No way, we're a Capitalist society when we're making money!
What they need to do is kill the bailout, repeal the Community Reinvestment Act, thus requiring banks to only lend to QUALIFIED individuals, and phase out Fannie and Freddie. Sure, this will make home ownership tougher, but you won't see the rampant failures that we're witnessing today, and it will also curb the ridiculous rates of appreciation we've seen in the last decade. It's time to face the facts - home ownership is a privilege, not a right. There's a certain school of thought out there that has desperately been trying to distort that fact and basically succeeded - that "success" has landed us squarely in the mess we're facing today.
Posted on October 1, 2008 10:11 AM
Sensei, thanks for a very thoughtful and well-stated response. In principle, I agree with you. Maybe I just don't have the nerve to accept the very painful consequences of a free market correction.
Posted on October 1, 2008 11:29 AM
Doug, I think it will be painful either way, but my biggest worry is that the bailout would ultimately not work. Just think to have economic conditions worse than they are now in addition to being saddled with nearly a trillion dollars in increased debt, likely held by someone like China.
That, to me, is a very real possibility if the bailout is passed and is just about the worst situation that we could find ourselves in economically.
Posted on October 1, 2008 11:46 AM