Posted by Rojas @ 11:10 am on September 30th 2008

Spin and principles

I don’t for a moment excuse the laughable, imbecilic spin being put forward by the House Republican leadership on this. The bottom line is that they, and the Democratic leadership, have their own feet jammed squarely down their throats at the moment, and there is nothing much they can say to excuse themselves. It’s one thing to abandon all principle in favor of expediency and another thing entirely to do so while failing to achieve the expedient result.

Still, let’s not make the mistake of confusing the Pelosi-centric excuses of a dozen dingbats with the principled objections of the bulk of the House Republicans. Mike Pence:

Benjamin Franklin said in 1759: ‘They that can give up liberty to purchase a little temporary safety deserve neither liberty nor safety.’

“Economic freedom means the freedom to succeed and the freedom to fail.

“The decision to give the federal government the ability to nationalize almost every bad mortgage in America interrupts this basic truth of our free market economy.

“It must be said, Republicans in this Congress improved this bill, but it remains the largest corporate bailout in American history, forever changes the relationship between government and the financial sector, and passes the cost along to the American people. I cannot support it.

Jeff Flake:

After having a chance to review the details of the bailout agreement, I will not be supporting the legislation,” said Flake. “Despite efforts by the House Republican Leadership to add some needed sanity to the proposal, this bailout still exposes taxpayers to hundreds of billions of dollars of liability.”

“We find ourselves in this predicament largely because implicit, and eventually explicit, federal guarantees in Fannie Mae and Freddie Mac shielded the financial services sector from market discipline. The way out of this mess is not to insert government deeper into the free market.”

The media has abandoned all pretense of objectivity on this issue, and so it ought not to suprise us that they are peddling the most venal spin imaginable. But the fact remains that the majority of Congress did the right thing, and the majority of those who did so did so for the right reasons.

posted in: Main

15 Comments »

  1. And the one candidate who’s right on this issue:

    Comment by Rojas — 9/30/2008 @ 11:21 am

  2. While my perspective on the media spin is biased by my reliance on the internet content of major media outlets rather than television news, I would contest your assessment that “The media has abandoned all pretense of objectivity on this issue.”
    Right this minute on CNN.com there are six headlines regarding the bailout:
    - Stocks Bounce After Battering
    - McCain Takes Hit for Bailout Collapse
    - Time: Let Risk-Taking Financial Institutions Fail
    - Commentary: We can’t go cold turkey on credit
    - Lou Dobbs: Hooray For Bailout Defeat
    - Time: Bailout Defeat A political credibility crisis

    I count at a minimum 2 of the 5 stories as anti-bailout, 1 as obvious pro-bailout, and 3 as arguably neutral analysis, though I will accept an argument that they have at least an implied we must do something aspect.

    Comment by Jack — 9/30/2008 @ 11:34 am

  3. I don’t watch much cable news, but I did spend some time doing so last night, and was vaguely appalled. Anderson Cooper, Neil Cavuto, Suze Orman, O’Reilly, all were doing showed basically with the premise of “WTF Congress?!” I didn’t catch more than maybe five minutes of actually speaking to ideological opposition to the core idea, but did catch a good 75 minutes of finger-pointing, concern-trolling, and frankly just flat-out patronizing. And even mainstream conservative blogs aren’t doing much better.

    What was interested: the only segments that were remotely anti-bailout were the reader mail ones.

    Good post, Rojas. If nobody else is going to, we might as well start doing round ups of from where the bulk of this opposition is coming.

    Here’s another good one.

    Rep. Bill Shuster:

    “The nature of the credit crisis our financial markets face today and the dire situation my constituents could face if our credit markets fail cannot be taken lightly,” he said.

    He said the plan voted on Monday is not guaranteed to solve the problem and could end up costing taxpayers more in the long run.

    “I am also deeply disappointed that this legislation fails to include any reforms to prevent the irresponsible practices that started this crisis in the first place,” he said.

    He said the rescue plan could send our nation down the slippery slope toward socialism.

    “Once the government socializes losses, it will have an open door to socialize profits,” he said.

    Comment by Brad — 9/30/2008 @ 11:46 am

  4. Darrel Issa:

    Darrell Issa, R-Vista (San Diego County), who made a fortune in car alarms, calmly told reporters afterward, “This is a manufactured crisis.” He said the administration already has the tools it needs to inject capital into banks, action he said would be “every bit as effective” as the bailout.

    Issa and other dissident Republicans had consulted with William Isaac, former chairman of the Federal Deposit Insurance Corp., who urged them to explore alternatives.

    “People began to realize that they don’t have to give $700 billion to the administration,” Issa said. “The FDIC can provide the capital … . They can end this crisis with the tools they have.”

    He and others demanded the suspension of a recent “mark to market” accounting rule that requires companies to write down their assets to current market value. They also said FDIC insurance should be raised to cover deposits larger than $100,000 to prevent a run on banks – already under way – by small businesses and wealthy individuals.

    “They aren’t pissed off at Pelosi,” Issa said. “They are pissed off at Paulson, they are pissed off at Bernanke, they are pissed off at Cox.”

    Interestingly, increasing the FDIC limit was what Obama was proposing this morning.

    Brad Sherman:

    Members have described themselves as hostages. Rep. Brad Sherman, D-Sherman Oaks (Los Angeles County), who voted against the bailout, said the original Treasury plan was “a ransom note that said if you ever want to see your 401(k)s again, send us $700 billion in unmarked bills.”

    Ha.

    Emmanuel Cleaver:

    “There is no reason for us to go in there and bail out George Bush,” Missouri Democrat Emanuel Cleaver said. “I don’t think anyone is going to step out on a limb,” he said, because “there is no way to sell this” to voters.

    From Mississippi a bit of bipartisanship:

    “At the end of the day, I could not in good conscience vote for a bailout of Wall Street that would increase our national debt by such magnitude and place such a heavy and undue burden on working families,” he said in a statement.

    Childers also said “considerable progress” had been made in adding oversight to the package. And he pledged to “keep an open mind as negotiations continue.”

    Thompson said in a statement that the legislation “fails to put the people first.”

    Like Childers, Thompson said he’s open to reconsidering the package.

    “We now have an opportunity to come back and work out a solution that is beneficial to more than just Wall Street,” he said.

    Jesse Jackson Jr.:

    “Today, I voted NO on the Emergency Economic Stabilization Act of 2008, a $700 billion earmark for Wall Street. Although this bill is a tremendous improvement over the legislation proposed by the Bush Administration last week, it still falls short of what is needed to shore up the economy, protect taxpayers and promote economic growth. We have gone from Roosevelt’s New Deal, to Reagan’s Raw Deal, to Bush’s Quick Deal. The American People are demanding a Fair Deal and on November 4th will elect Fair Dealers.

    “This bill is simply a band aid not a cure for the financial crisis, and it does little for the hard-working Americans who will pay for it. It does not go far enough in addressing the systemic and terminal problems of our financial system. It further privatizes profits and socializes the losses. This crisis started because of the home mortgage market, yet this legislation merely suggests that the Treasury Secretary implement a plan to mitigate foreclosures and to encourage servicers of mortgages to modify loans. There is no explicit directive to actively restructure mortgages. Furthermore, the bill does not allow bankruptcy judges to restructure troubled mortgages.

    Comment by Brad — 9/30/2008 @ 11:57 am

  5. More blockquotage:

    “In its current form, I anticipate voting against it,” said Rep. Darrell Issa (R-Calif.). “I have two problems with my constituents: they are either dead set against it or they don’t understand it.”

    “Unless this bill is radically different, I am a ‘hell no,’” said Rep. Brad Sherman (D-Calif.).

    The California lawmaker led a meeting with economists Sunday. Several prominent Democrats stopped by, including House Judiciary Committee chairman John Conyers (D-Mich.).

    In addition, members facing tough reelection fights, like Rep. Nancy Boyda (D-Kansas), were also present. Boyda said she is undecided.

    Sherman asked his party’s leadership not to force a vote on Monday and afford more time to members to deliberate over the legislation. “We can draft a better bill,” he said.

    Rep. Chris Van Hollen (D-Md.) said Sunday night — when members have the bill in hand after more than a week of negotiating — will be critical.

    “This is a period of time when people want to see legislation on paper, to see if the principles they stood up for are in the legislation,” Van Hollen said.

    Comment by Brad — 9/30/2008 @ 12:02 pm

  6. David Sirota:

    Throughout the day, I have received some email and seen some comments from people purporting to be “progressive” yet claiming that anyone who opposes the Paulson version of the bailout bill is thrilled to see the stock market decline today, and more generally, happy that America may go into a second Great Depression. These outbursts are likely spurred by fear, which is understandable, considering the Bush administration, congressional Democratic leadership and media are all insisting what Margaret Thatcher famously insisted: that There Is No Alternative to what’s being proposed, and that if what’s being proposed doesn’t pass, we’re all going to die [...]

    Let me be clear: I have a modest retirement account that I’ve worked hard to save. I’m worried when I see what’s happened to the market. But I also realize that while Wall Street says this is a new crisis, there’s been a health care, wage, job and pension crisis that’s been going on for the last decade – and so forgive me if I find it a bit ridiculous that while no one said we had to act quickly on those life-and-death crises, we are supposed to nonetheless see this banking sector problem as Armageddon that demands handing over 5% of our entire economy to one unelected political appointee (Henry Paulson). In that sense, all the alarmism – especially coming from such a discredited Washington crowd – rings a bit hollow.

    I’m not saying there’s not a credit problem – there is. But we cannot let the authoritarians use that credit problem as a rationale to trample our deliberative democracy in the name of helping their cronies. If we hand over $700 billion to one man – Henry Paulson – under insane deadline demands, we are quite literally subverting our democracy to the whims of authoritarian capitalism, flown under the banner of kleptocratic socialism. Those of us who hope Congress says “hell no” aren’t rejoicing at our economic turmoil – we’re the ones who have been predicting it, and who think the way to prevent things from getting worse are to actually do something other than giving money to the same people that got us to this awful point.

    Comment by Brad — 9/30/2008 @ 12:14 pm

  7. Sirota seems to have a wide definition of ‘crisis’, which might deserve some internal gradation.

    On the Pelosi speech, whilst it might have been inopportune, I can’t imagine that the Republicans were actually upset by it. Politics, after all, is tough. I guess that maybe for some it removed whatever bipartisan cover they might have been planning on acquiring, but it seems to me that the importance of the speech is rather exaggerated (although Pelosi, unless she planned this, might want to reflect on when best to launch the rousing partisan attacks).

    Comment by Adam — 9/30/2008 @ 2:20 pm

  8. Also, Jesse Jackson Jr is the scary sort of Democrat refusenik.

    Comment by Adam — 9/30/2008 @ 2:21 pm

  9. I do wonder, however, if some of the House Republicans, at least those confident of re-election, are revelling in the ability to drive a stake into McCain. This could wind up as the end of McCain’s chances, I think.

    Comment by Adam — 9/30/2008 @ 2:22 pm

  10. Which is possibility #2 that I mentioned. They didn’t want to vote against, felt they had to, and are now trying to offer up Nancy Pelosi as they reason they had to. Which is patently, pathetically ridiculous. Either she actually put them off, or they’re just saying they did because they don’t have the balls to come forward with an actual, you know, conviction. As Rojas notes, it is a minority talking the Pelosi nonsense, but their view seems to be getting a lot more amplification from right wing media circles (and that includes, more aggressively than just about anybody, the Republican nominee for President) than actual, you know, conviction.

    Pelosi herself, one would hope, will indeed be face-palming herself a little either way.

    Comment by Brad — 9/30/2008 @ 2:25 pm

  11. Also, Jesse Jackson Jr is the scary sort of Democrat refusenik.

    Actually, he’s not too bad here. The scarier ones are the Hispanic caucus, who more or less explicitly say that they were upset that there wasn’t enough handouts (the ACORN stuff you mentioned, and even more specific ones).

    The CBC, though there is a fair bit of that, is a little better.

    The Wall Street Journal has a good article on this, btw, the different perspectives of the nayers. But really, the takeaway is that the nay votes, more or less, were pretty consistent in voting nay because they objected to the core philosophy behind the bill, or at least the kernel of the policy. Golden parachutes, massive debt, socializing losses with no clear oversight, restitution plans, etc. I keep saying it, but I can’t agree with Rojas enough here. And James too, when he said that for once, they seemed to have grown a pair.

    I remain skeptical on whether the “no bailout at all” position holds much merit—I understand that some level of intervention may be needed. But the shotgun wedding of turning over 1 trillion dollar budget to one guy in the executive branch, taking Congress out of the equation, and nationalizing a huge chunk of the American marketplace, all with a frenzied “just trust us” mentality, is something that I think deserves a knee-jerk rejection. Would that the government engaged in more knee-jerk rejections and less knee-jerk adoptions.

    Comment by Brad — 9/30/2008 @ 2:35 pm

  12. On the plus side, the bit that would be nationalised (crappy mortgage debts) is almost worthless right now! So it’s not so much that a huge chunk of the American marketplace is being nationalised, although one hopes that the holding value of those products is rather better than the current value.

    Comment by Adam — 9/30/2008 @ 2:57 pm

  13. The current value being zero?

    Comment by Brad — 9/30/2008 @ 3:48 pm

  14. Not quite, but it’s worth pretty little. So ‘almost worthless’ is about right, I think (and of course it is, I said it). The holding value, however, should be significantly higher.

    Comment by Adam — 9/30/2008 @ 4:14 pm

  15. Actually, he’s not too bad here. The scarier ones are the Hispanic caucus, who more or less explicitly say that they were upset that there wasn’t enough handouts (the ACORN stuff you mentioned, and even more specific ones).

    You’re right:

    Rep. Joe Baca, a Democrat from California and the chairman of the Congressional Hispanic Caucus, warned on Sunday that the bill might not have enough Democratic votes to pass.

    “There’s nothing in here that guarantees new jobs, nothing that guarantees salary increases,” he told The Hill newspaper. “And that’s a huge problem.”

    From here. It’s the sort of thing I was concerned about when I was considering whether Pelosi would lard the whole thing up to win more Democratic Party votes (although it’d surely lose Republican votes along the way).

    Comment by Adam — 9/30/2008 @ 9:39 pm

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