Dean Barnett of the Weekly Standard had a good article about the federal bailout debacle. He divides the House Republicans into two groups & blasts each side for helping to drop the ball on the bailout:
1) The Mike Pence doctrinaires who welcome a free market curative like a Depression for our current woes. I guess they view it as sort of the economic equivalent of that stuff you drink the night before a colonoscopy. As misguided as Pence and his minions are, they at least have a certain nobility complementing their foolishness. I would be remiss if I didn’t note that a significant subdivision of the Pence camp rejects the counsel of virtually everyone who knows anything about economics and instead believes that our current situation isn’t so dire. Call it conservative magical thinking.
2) A bunch of other Republicans who would have voted for the Paulson Plan had Nancy Pelosi not said some stuff that hurt their feelings just prior to the roll call. They had thought passing the Paulson Plan was an urgent national priority. Then, the Speaker said some stuff that made personal pique take priority. Outdumbing the Pence Republicans was a tall task–this coterie of GOP representatives was up to the task.
Barnett posits that neither Republicans nor Democrats are willing – or even capable – of finding a bipartisan/non-partisan solution to the financial crisis gripping the country. He says that possible solutions are available for consideration & cites one of them as an example:
In case you’re looking for ways forward, there are plenty out there. A few days ago, Bill Kristol linked to a provocative piece by Harvard professor Lucian Bebchuk that suggested the best way to recapitalize our faltering financial institutions would be via rights offerings backstopped by the federal government. Translated into English, this plan would address the financial system’s most urgent need–recapitalizing the financial institutions that need it–directly. What’s more, the recapitalization would come from shareholders, not taxpayers. It likely wouldn’t cost Joe Sixpack a red cent. It would also keep the federal government out of the banking business, a matter rightly near and dear to the hearts of libertarian leaning Republicans. And yet they never considered this plan, such is the state of their current non-constructive pose.
The Paulson Plan only addresses (or should I say addressed) the need for recapitalization indirectly, by providing the funds necessary by gobbling up presently undesirable mortgage backed securities. The Republicans could have spent the past two vital weeks coming behind a plan like Professor Bebchuk’s (or another one) assuming Paulson’s plan was unacceptable. Instead, they dithered. Some in the GOP obviously would rather have a Great Depression redux instead of taking the necessary steps to prevent it. Call it a twisted matter of principle. My point here isn’t to lobby for the Bebchuk Plan. My point is to show that there are potential solutions out there that the political class hasn’t seriously (or even frivolously) addressed.
I share Barnett’s frustration. Yes, Nancy Pelosi & her sychophant colleagues are fiddling while the nation’s financial markets burn – and a case can be made that the failure of the House vote is due, in part, to Team Pelosi playing politics – but Republicans can rightfully be accused of the same thing when the only excuse the GOP House minority leadership can provide for itself & its members over the vote’s failure is one of bruised sensitivities over Democrat demagoguery. My God, people! Grow a pair!
There’s an opportunity here for the McCain campaign. Of course, there’s also an opportunity for the Obama campaign. Answers are needed, and lord knows the two senators have a big enough platform to provide them. But as far as Obama is concerned, his “prudence” by now is a known quantity. We won’t see any game changing propositions emanate from this preternaturally cautious politician. Obama lags events–he doesn’t lead them.
That leaves it up to McCain. Frankly, whether he can politically overcome a millstone the size of this economic crisis is questionable. Let’s face it–the financial meltdown is the equivalent of Mark Foley’s salacious instant messages on stilts. But there remains the matter of duty. House Democrats, House Republicans, Senate Democrats, Senate Republicans and the White House have all been unable to move the ball forward. Collectively, they’ve spent the past ten days squabbling over a badly flawed bill that even if passed may still not have saved us from a very deep recession or worse.
The only guy out there with the political juice to offer something new and get it seriously considered is John McCain. Even if he got a good bill passed, it might not be enough for him to win the election. But it would be his finest hour.
I couldn’t have said it better. Like Barnett, I think McCain has one last opportunity to be a hero – even if his heroism dooms his presidential bid. His poll numbers have fallen since his failed pre-debate gambit & the failure of the House vote increases the perception that McCain – along with his party – need to be retired ASAP. McCain has one last shot to turn things around & that shot involves saving the nation’s financial system (both short & long term) from the depredations of itself & its enablers in government. If McCain & his GOP allies fail to come through on this mission, Obama will be our next president.