Bailout Sunk by Angry Voters & Vengeful Pelosi

Government may still try to fix the crisis

government caused – but not today

.Last week the self-appointed Smartest People In The World convinced the President, both candidates for President, and roughly half the politicians in Congress that a category five, financial catastrophe would engulf Main Street if the Treasury Department didn’t bail out Wall Street by buying hundreds of billion in mortgage-backed securities that are currently worth only a tiny fraction of their original face value, but may, in the future be worth more.

Since the bailout concept was wildly unpopular with voters, all members of Congress were reluctant to vote for it.  But it appeared that a narrow majority was willing to bite the bullet, defy their angry constituents, and vote yes, out of sincere belief that without the Bailout there would indeed be an economic disaster.  A large minority was against it, some motivated only by opinion polls, most based on the sincere belief that allowing markets to function would be more effective, long term, than massive government intervention.

Democrats have a majority in the House but they did not want to pass the bailout with only on their own members’ votes.  They wanted a lot of Republican votes to prevent Republicans on the campaign trail from turning the hated bailout into a prime, anti-Democrat campaign issue.

Sunday afternoon, the self-appointed Smartest Members of Congress, Republicans and Democrats, came together, in a show of setting aside partisan differences, and finally negotiated a 106 page, “bipartisan” bill that would empower the Treasury Secretary to start the buying.

Bipartisan unity was the theme of the day, as House Speaker Nancy Pelosi stepped in front of the cameras to make the announcement.  But, in her very first sentence Ms. Pelosi invoked the Obama campaign slogan that the crisis this bailout was to address, as with all trouble in America, resulted from “the failed policies of the Bush Administration.”  She went on to accuse the President of simply refusing to enforce regulations.

As we’ve noted before, Obama and the Democrats’ goal is to convince those voters who aren’t inclined to deep thinking or research that for every problem they face, for everything that makes them anxious, there is “a policy,” implemented President Bush, that is the cause.  Democrats never identify any specific Bush policies in this appeal to ignorance and emotion, because for the most part there aren’t any.

As we have documented in previous posts in this series most of current crisis results from irresponsible mortgage lending by two government agencies, and by laws developed by Democrat Congresses requiring irresponsible mortgage lending by the private sector.

This morning Ms. Pelosi went to the floor of the House to hurl another load of vitriol, blaming Bush again.    Her speech, purportedly in favor of the Bailout, was so laced with anti-Republican invective that a listener from outside Congress could have concluded she was against the bill, or that to vote for the bill was to agree that Bush and the Republicans intentionally created a crisis in order to enrich Wall Street traders.  Here’s video of her performance.

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All this venom from Pelosi was enough to drive a dozen or two reluctant Republicans who had said they might vote yes, in spite of overwhelming opposition from their constituents, into the no column.   The loss of Republican support drove scores of Democrats, who were counting on a lot of Republican votes to invalidate criticism from challengers in close reelection races back home, from the yes column to the no column.

Later, Ms. Pelosi announced Democrat Leaders’ pledge to work on a revised bailout bill, starting immediately.  If no bailout passes and America is not engulfed in fianancial chaos, we will know it was unnecessary government intervention.  Ironically, we will have Speaker Pelosi, whose default position is always more intervention, to thank for killing it!

2 Comments so far

  1. theclassiclib on September 29th, 2008

    “the self-appointed Smartest People In The World”

    LOL!

    You have officially described them perfectly!

  2. aaa again on September 30th, 2008

    For all of those who believe this is a “failure of the Bush administration” you should look at this CSPAN video of Congressional hearings on Fannie and Feddie. It is the absolute smoking gun, on film and in their own words, as Republicans call out Fannie, Freddie and Franklin Raines………while Democrat after Democrat, including Barney Frank, sarcastically deny any problems with the institutions.

    Separately, in perhaps the most blatantly irresponsible period in American journalism, only YouTube and CSPAN seem interested in getting the truth out. ABC, NBC, MSNPC, CBS etc?????

    Silence. In the face of “the most extreme financial crisis of our time.” Silence…..all for politics. To get their guy eklected.

    Shamefull.

    http://www.youtube.com/watch?v=_MGT_cSi7Rs&eurl=http://5.gmodules.com/ig/ifr