The River

Monday, September 29, 2008

House Rejects Bailout Package, 228-205; Stocks Plunge


In a moment of historic drama in the Capitol and on Wall Street, the House of Representatives voted on Monday to reject a $700 billion rescue of the financial industry.

Mainstreet ain't buyin it, either.

Check out the comments on this NYT article. This one is from my neighborhood, and you can't get much more mainstreet than that:

Bailout shreds our first principles of equality and fair play. The innocent of limited means are to repair the greed and recklessness of the perpetrators, many of whom possess staggering wealth. If anything trumps the notion that some institutions are "too big to fail," it ought to be that some principles are too basic to be pushed aside.
— EW, Tucker, GA

And this one is very perceptive:

This plan is indefensible using reason. That's why all they have resorted to is fear mongering. Disgusting. Shameful. Irresponsible and insulting.

"...this sucker could down!" "Financial Armageddon"

"A once in a century event" "Unthinkable catastrophe" "3-4 million Americans will lose their jobs in the next 6 months" "A meltdown on Wall St. that will IMMEDIATELY cause a meltdown on Main St."

Pelosi's statement was priceless- "All of this was done in a way to insulate Main St. and everyday Americans from the crisis on Wall St."

Insulate? Then why no bankruptcy reform? Why no money for investigators and auditors to provide transparency of the web of toxic practices that got us into this mess? Why no commitment to shut down the CDS casino going forward? What you sold to everyday Americans is the most expensive blanket ever made while neglecting to fix the heat.

The fundamental principle of this bi-partisan plan is a $700 billion dollar tax increase on Joe six-pack and his family to pay the gambling debts of multi-millionaires. That's just a fact. The bogus possibility of taxpayers recouping their losses on those worthless credit derivatives is dependant on the housing bubble re-inflating, which we should all be hoping will not happen! If it does, it will only be brief before it bursts again because bubbles must burst by definition. Inflated price/household income ratios are dangerous. Get it? Talk about voodoo economics. This is the equivalent of bloodletting to treat AIDS.

200 economists wrote to Barney Frank and Co. urging them to wait and study alternatives. He told them to take a hike. The public, screaming in fury at their representatives in polls and thousands upon thousands of phone calls, letters and e-mails were told to take a hike.

Exactly WHY there isn't more time has never, I repeat, NEVER been laid out in unambiguous terms. All we've been fed is a revolting diet of the politics of fear. "You won't be able to get a mortgage! Credit card rates will skyrocket! Businesses will be unable to expand and grow. Unemployment will rise!" They think we're idiots. All these things have temporarily happened before without cries of Armageddon.

Sure, if you got bad credit, you won't get a sub-prime mortgage, which is a really good idea. But mortgages make banks money, they're not going to disappear. Credit card rates going up might cause people to stop living beyond their means, also not a bad idea. Businesses with good products and good models will grow because they are profitable, worthy of investing in. Those with no profits, when you take away the deceptive accounting tricks derivatives facilitate, will fail. And a jobs program would cost a lot less than $700 billion dollars.

The policy makers on both sides of the aisle who accept this deal are lying to us and bowing to fear, subservient to financial industry lobbyists. This bill is a big, fat ugly mistake that must be stopped.

— joe (new york), New York

UPDATE: McCain and Republican leaders are saying it failed because of a childish fit by Republicans over a Pelosi speech! Unbelievable.

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