John_Schwada's Blog

Did Republicans kill the bail-out – as early news reports have suggested?

Here are the numbers behind the sound-bites, the finger-pointing: Republican members of congress supplied 58.3 percent of all the votes to kill the plan (133 out of 228 no votes) while Democrats provided 41.6 percent of the plan-killing votes (95 out of 228 no votes). In fact, it was a bi-partisan finger on the trigger.

Even those Democrats who voted for the plan did so while holding their noses.

Let’s hear what U.S. Rep. Henry Waxman, D-Los Angeles, said when it was his turn to address congress on the so-called Emergency Economic Stabilization Act, H.R. 3997.

“Mr. Chairman, I rise today in reluctant support of H.R. 3997,” Waxman said. “This is a Republican bill which must pass with bipartisan votes. Many Democrats don’t like it. Many Republicans are choking on it. But for now, it would be irresponsible to do nothing and I will vote for this bill….what we are voting on is the Bush bailout plan.”

“I would have preferred that we take a different approach. Nobel Prize economists have recommended alternative approaches….But the Bush Administration has been adamant that Congress adopt its approach. They have steadfastly resisted considering other options to protect the taxpayer.”

But then Waxman also praised fellow Democrat, U.S. Rep. Barney Frank, D-Boston, for improving the plan with amendments – without mentioning what they were.

If the bailout later failed to pull the economy out of its doldrums, Waxman could say he only voted for it because it was forced down his throat by a stubborn Bush administration while better options were ignored.

On the other hand, if the bailout (providing, of course, that it was approved) did succeed in re-booting the economy, Waxman could say he voted for it and that fellow Democrat Frank made the entire plan workable.

In other words, Waxman had hedged his bets so he was blameless if the bailout failed, victorious if it succeeded.

Real moral victories are hard to find anywhere in this rubble however.

Just look at this perverse element of the proposed (and now failed) bailout: I'm talking about a provision under which the government would have the option of limiting the pay of future executives (of faltering financial institutions that participate in the bailout) who might actually do the hard work of turning around their companies. But the government would not - could not - reduce or eliminate the compensation agreements (aka "golden parachutes") for those past or existing executives who steered their companies into the reckless lending and investment decisions now tearing our economy apart.

In other words, we'd limit the pay incentives for good guys but let the bad guys who created the mess keep their ill-gotten gains? You gotta love it. When are the bad guys ever going to pay...

One last thought: if John McCain's debate performance last Friday wasn't enough to sink his candidacy, today's House vote - as it is initially being widely portrayed in the media - should deliver the final coup de grace. That message: dear voters, Republicans killed the bailout, crushed your 401(K) investment program , all because GOP lawmakers were outraged that House speaker Nancy Pelosi, as the vote was about to be taken, attacked the Bush administration, blaming its "right-wing ideology" for the economic mess. But how does that explain all the Democrats voting against the bailout?

"Indeed, it was in the Bush years that antiregulation and deregulation found full expression, fueled by an ideology that markets know best, government hampers markets, and problems will magically fix themselves. The nation is now painfully relearning that the opposite is true."

Those key votes, the Times editorialized, were in 1995, 1999 and 2000.

Excuse me for bringing up an inconvenient truth: George Bush did not take office until January, 2001. Now that does not mean we should let Bush off the hook for failing to stem the tide of bad loans being made in the name of expanding homeownership to everyone in sight. But it does leave us wondering where Bill Clinton - our nation's president from Jan. 1993 to Jan. 2001 - was when those three votes were taken....granted Republicans held majorities in congress during those years but what were the vote breakdowns, Republican/Democrat, on those measures?