Dems Blowing it (including Obama) on Bailout Bill

remember in 2006 when the dems were elected to end the Iraq war and didn't - their approval dropped like a stone.

the dems in the senate refused to even try to get a timeline for withdrawal with funding passed.

Now the public is against the bailout bill that gives Paulson enormous powers and ignores his conflicts of interest e.g. he still owns goldman sachs shares.

Now rather than passing a bill with Democratic votes in the house - a bill that would be more progressive including actual measures through bankruptcy court to keep people in their homes or perhaps mandated transaction fees for wallstreet to pay for it they appear ready to cave to the GOP by adding tax breaks.  Nothing for people to keep them in their homes or charge wall street for their crimes... Why not add provisions to attract Dems? Why try to get GOP votes? (I know they want to say "bipartisan" but if they don't get a majority of GOPers (which they won't) they will own it anyway.

http://bloomberg.com/apps/news?pid=20601 070&sid=aoJ7Et81o4c8&refer=polit ics

Also linked to the legislation is a two-year extension of tax breaks that will save individuals and corporations about $149 billion over the next decade, another move popular among House Republicans. Two-thirds of House Republicans and 40 percent of Democrats defeated the bailout plan on a 228-205 vote. President George W. Bush and Senate leaders vowed to revive the legislation.

Obama doesn't seem to realize having an actual economic crisis is good for him.

Talking about real issues helps Obama - talking about lipstick and soldiers' bracelets and brittany spears does not.  As soon as the crisis is "averted" the media will go back to talking about fluff.

I hope the new bill loses enough Dems in the house that it fails to pass again.

Obama made a huge mistake by embracing this thing tighter yesterday in Nevada.  Josh Marshall at TPM noticed the risk.  I somehow hope that Obama can vote against this though I fear he has McCained himself on it now.

Why do we elect dems to congress and the senate only to see them move to "sweeten" the bill for the GOP????

Should Obama lose (which I hope he doesn't) you will be able to trace it back to the day the senate passed this Turkey.....

Tags: mcsame (all tags)

Comments

35 Comments

I should add

that this bill does nothing for the fundamentals of the economy.  (and the politicians don't claim it does but most people think it will)

if this passes with majority dems but less than majority GOPers (which is my prediction) than the dems own a bill that ultimately did not help the economy  at the end of the day...

by TarHeel 2008-10-01 04:57AM | 0 recs
Re: I should add

The only thing to recommend the bill is it will free up credit for the short term. Otherwise it's a total suckfest. There is absolutely no reason for a Democrat to vote for more damned tax breaks for billionaires. I hope the Dems turn on this turkey unless they insist on additional sweeteners for the middle class.

by Spiffarino 2008-10-01 05:39AM | 0 recs
THIS bill should be rejected..

Its pure unadulterated trickle down economics. The mortgage backed securities business was a scam, and anybody could have told us years ago this would happen.

For the government to take on (i.e. "insure"-) contingency RISKS without ALSO taking on contingency PROFITS is pure stealing from all of us to give to the rich.

by architek 2008-10-01 09:27AM | 0 recs
I don't know what the hell they're doing

Unless they're planning on just pulling the bait and switch to end the tax breaks once Obama gets into office, I don't see how this is an attractive maneuver at all.

They needed to make the bailout smaller to appeal to the conservative holdouts, not offer the same thing with candy on top.

by Dracomicron 2008-10-01 05:27AM | 0 recs
there are things even

the progressives and wingers agree on it the house like the mark to market rule....

I am very afraid that McCain will vote against this!!!

he is so erratic that he can come up with an excuse to vote against it...

If I'm Obama I'm very worried McCain will vote against it.

by TarHeel 2008-10-01 05:30AM | 0 recs
That's always the risk

I have been pretty sure that McCain will find a reason to come down against it, and have been from the start.  He's only got stunts left.  

I'm not very worried about it, though.  McCain's so erratic, as you mention, that it will be easy to pin him with a flip-flop.

by Dracomicron 2008-10-01 05:32AM | 0 recs
except

that at it's core this is not a mainstreet bill and the people know it.

If I'm a McCain advisor I say vote against it..

the bill will pass the senate so the best place to be politically is against an unpopular bill that passes...

by TarHeel 2008-10-01 05:42AM | 0 recs
Typical McCain, a maverick when it's meaningless

Yup, that's his m.o. But still, it would be such a monumental flip flop on his part at this point.

by fairleft 2008-10-01 09:04AM | 0 recs
The GOP wants the Cantor bill.. which is worse

which is an even bigger giveaway to the rich.. plus it makes the government "insure" the assets at their highest possible value, assuming the risk, but it does not let the government collect any profit at all because they are only "insuring" the risk..


http://ap.google.com/article/ALeqM5gTkAW M5Ona9_HWJbLv0IUhR6SSywD93E2S100

GOP conservatives present rescue alternative

By ANDREW TAYLOR - 5 days ago

WASHINGTON (AP) -- A group of conservative Republicans in the House on Thursday proposed a financial rescue package of tax breaks and a new government-sponsored insurance program for mortgage-backed securities as an alternative to President Bush's proposed $700 billion bailout of Wall Street.

Instead of the government buying the toxic mortgage securities, banks, financial firms and other investors holding them would pay premiums to the Treasury to finance the insurance coverage.

The idea is that the insurance would give investors enough confidence to buy the illiquid securities and establish a market for them.

Rep Eric Cantor, R-Va., said the plan would be to remove the burden of the bailout from taxpayers and instead place it, over time, on Wall Street.

"Instead of a purchase scenario where you have the government injecting $700 billion right up front into the markets, what you have here is an insurance plan," Cantor told reporters. "In order to get this insurance, the banks with these failed assets would have to pay for the government backing, pay for the insurance."

The plan emerged after it became clear that House Republicans in large numbers weren't coming around to the approach favored by Treasury Secretary Henry Paulson, which is to have the government buy up the troubled securities, hold them, and eventually sell them off.

Under the House conservatives' plan, institutions holding stronger assets would pay lower premiums for the government backing; higher-risk securities would require higher premiums.

Robert Litan, an expert on banking and finance at the Brookings Institution, called the framework unworkable, saying it would not achieve the basic goal of creating a market -- and establishing prices -- for mortgage securities no one's willing to buy.

"Everything depends on how you value the security," Litan said. "If you do the deposit insurance scheme, there's nobody out there to know what the right price is."

The House conservatives' plan also would:

  • Offer temporary tax relief to free up capital for companies to lend one another.

  • Temporarily suspend dividend payments by financial institutions.

  • Require participating firms to disclose to the Treasury Department the value of mortgage assets on their books, private bids on them in the past year and their last audit reports.

  • Forbid government-sponsored mortgage giants Fannie Mae and Freddie Mac from issuing securities on unsound mortgages.

  • Require the Securities and Exchange Commission to investigate the performance of credit-rating agencies.

by architek 2008-10-01 09:42AM | 0 recs
The Public Isn't Against The Bailout

Just because an economic crisis is good for Obama doesn't mean we should actively avoid trying to fix the situation. That is an incredibly cynical thing to suggest. Something needs to be done in the short term to deal with the potentially catastrophic damage in the credit market, for businesses and for people borrowing money for their homes and their kids' college tuition. People like Kos and Jerome Armstrong and Chris Bowers are simply not credible when they rail against addressing the situation. Just read Krugman's blog if you want proof that economists on the left believe something urgently needs to happen, even if the plan is imperfect.

The Dems' tactic is to tweak the bill so that Republicans, not Democrats, put it over the top. That way the plan cannot become a political liability for Democrats in Congress. More will need to be done later on, when Obama is President and the Dems have an even firmer hold on the House and Senate.

Besides, all the evidence suggests the public is coming around to supporting some kind of bailout/rescue package. The tumbling Dow scared a lot of people, and had a real impact on people with 401Ks and IRAs. And most economists agree that yesterday's improvement was just a "dead cat" bounce caused by investors trying to make a quick buck off the bargain stocks. McCain is going to vote for this bill, Obama is going to vote for it too. It won't be an issue in the Presidential campaign. Relax.

by Hatch 2008-10-01 05:54AM | 0 recs
McCain / GOP are waiting

for something to pass, anything, so they can come out against it.  They don't give a squirt of piss for the actual future of our country, just their own careers.

So what Democrats should be doing is saying to the GOP, "Fine: fuck you.  We've got the numbers to pass our own  bill" and then pass along party lines a progressive bailout bill with real protection for folks in mortgage default, and real and enforcable limits on CEO parachutes.

Instead they're just continuing to try and be bipartisan.  It makes me sick.

by looty 2008-10-01 06:24AM | 0 recs
Read the transcript of this radio show..

And then see if you still want to rescue these guys..

They KNEW those loans were bad..

http://www.thisamericanlife.org/Radio_Ep isode.aspx?sched=1242

by architek 2008-10-01 11:19AM | 0 recs
Re: Read the transcript of this radio show..

I listened to that show when it originally aired, so thanks for the link. I've been looking for it. Did anyone say these weren't bad guys? This IS NOT about bailing out the bad guys. This is about dealing with the credit squeeze before we enter an economic death spiral. If that is the medicine necessary, or even the only medicine we can get, and if we're truly as sick as it seems, then so what if it collaterally bails out those guys. We should have been punishing them before; we can in the future, but right now, the only question is what will happen if we don't do this.

by Travis Stark 2008-10-01 11:46AM | 0 recs
What an assinine thing to say

"Obama doesn't seem to realize having an actual economic crisis is good for him."

Ya. That's what I want. A President who puts his short term political interests above the country.

by Travis Stark 2008-10-01 06:48AM | 0 recs
he's not president

he's a senator campaigning.

and yes McCain would do anything to win and so should obama

by TarHeel 2008-10-01 06:54AM | 0 recs
Re: he's not president

Obama is stepping up and advocating for doing something to help the credit squeeze for the betterment of the country, I am quite sure if this works, even for the shorterm while we reregulate and fix the system, Obama will be fine, in fact, I'd call it a landslide.  On the other hand, a poor economy helps Obama.

You are not suggesting that we hold the country as economic hostages until this is over are you?

by KLRinLA 2008-10-01 07:41AM | 0 recs
Why not?

McCain isn't sharing his "plan" to catch Osama Bin Laden until he becomes president.  Why should Obama help fix the economy if it doesn't benefit him politically

Nevermind the fact that Obama not playing these games is something that recommends him over McCain.

by Dracomicron 2008-10-01 08:24AM | 0 recs
Re: Why not?

Yes let's advocate Dems running our own October surprise, let's really muddy the waters of what makes a Democrat and Republican fundamentally different.  I think we should hire Rove to help us out with this strategy.  Know what? let's get some voter suppression of the elderly, confuse them about the voting dates.  I mean, I just don't get why Obama has stayed above the fray and not stooped down to the garbage pile of what we call Republican campaigning.  Polls indicate he has really been affected by his lack of stooping.

For those browsing this page and not familiar with MyDD, this is what we call snark and should not be taken seriously

by KLRinLA 2008-10-01 10:41AM | 0 recs
I approve

For those browsing this page and not familiar with MyDD, this is what we call snark and should not be taken seriously

Non-regular MyDD readers are a group which needs to be considered these days.

This is not snark.

by Dracomicron 2008-10-01 12:40PM | 0 recs
Because I know what asshole republicans do

does not mean I want to be represented by someone who acts like them.

by Travis Stark 2008-10-01 11:38AM | 0 recs
Bailout Bill

That's why I say I, like every American I'm speaking with, we're all about this position that we have been put in where it is the taxpayers looking to bail out. But ultimately, what the bailout does is help those who are concerned about the healthcare reform that is needed to help shore up our economy. Um, helping, oh -- it's got to be all about job creation too. Shoring up our economy, and putting it back on the right track. So healthcare reform and reducing taxes and reigning in spending has got to accompany tax reductions, and tax relief for Americans, and trade, we've got to see trade as opportunity, not as a competitive, um, scary thing, but 1 in 5 jobs being created in the trade sector today. We've got to look at that as more opportunity. All of those things under the umbrella of job creation. This bailout is a part of that.

by QTG 2008-10-01 07:27AM | 0 recs
THROW IT OUT and start fresh..

n/t

by architek 2008-10-01 11:20AM | 0 recs
Re: Bailout Bill

Did you do that talking like Palin, or Fey? :-)

by Travis Stark 2008-10-01 11:41AM | 0 recs
Re: Bailout Bill

 Direct quote from Palin/Couric train wreck. But I transcribed it myself, so it's not plagiarized,  it's just poorly punctuated.

by QTG 2008-10-01 12:48PM | 0 recs
Re: Bailout Bill

No. You misinterpret my point. This is the text that SNL put pretty much verbatim into the Tina Fey sketch last weekend. I thought you knew. Look it up if you haven't seen it. Hilarious. Somebody even ran the two speeches side by side if you can find that.

by Travis Stark 2008-10-01 01:18PM | 0 recs
Re: Bailout Bill

 I did. Palin can write for SNL after she loses the re-election for governor of AK.

by QTG 2008-10-01 03:02PM | 0 recs
as an obama supporter

this shit is depressing. the lack of true leadership is striking.

by highgrade 2008-10-01 07:27AM | 0 recs
Asked Everyone I Met -

NOBODY liked it!

Are we going to punish these bankers who can't handle money by crushing them by tossing money upon them?

by blues 2008-10-01 07:53AM | 0 recs
Re: Asked Everyone I Met -

So you'd rather do it by cutting our own throats and bleeding all over them?

by Travis Stark 2008-10-01 01:19PM | 0 recs
Obama doesn't grasp the problem

He is being told that this is a liquidity problem; is everything else "fundamentally strong" then?

Not at all.

Because of what has already been done (exporting the manufacturing base) A GREAT DEPRESSION IS INEVITABLE!

This bill only LENGTHENS and DEEPENS the Depression.

Why? If the economy can produce 10 trillion but is priced at 14 trillion then guess what?  The economy will drop by 4 trillion.

NOTHING CAN CHANGE THAT.

Now you can borrow a lot of money and pretend that the economy can produce 14 trillion or a little less and pretend that it produces 13 trillion, but guess what? It still is only producing 10 trillion!

But borrowing is never cost free! The economy will shrink from 10 trillion due to malinvestment and interest payments! The few extra years or months of illusion will be tagged on to the end of the Depression, with interest.

You aren't EVER going to hear that from Obama.

by Paul Goodman 2008-10-01 08:15AM | 0 recs
Re: Obama doesn't grasp the problem

> A GREAT DEPRESSION IS INEVITABLE

Thank you Mr. Economist. Your sources please.

by Travis Stark 2008-10-01 11:49AM | 0 recs
China is losing manufacturing jobs too..

Productivity is rising though.

We all MAKE MORE and more, WITH FEWER and fewer PEOPLE.

That's the goal of modern technology.

by architek 2008-10-01 12:26PM | 0 recs
Re: Obama doesn't grasp the problem

Paul, I was so looking forward to meeting someone smarter than Obama. Nice to meet you.

by QTG 2008-10-01 03:04PM | 0 recs
Re: This is really disappointing.

I was hoping against hope that our party leadership would actually lead on this.  Instead, it's Bush, McCain and Obama, all on the same page.  Reid is completely ineffective, a disgrace.  I'm no economist but I grasp that increased spending and decreased revenue means adding to our already massive debt.  And no help whatsoever for homeowners.  

Oh, well.  Guess I'll send yet another round of frutiless e-mails to my wonderful democratic representatives.      

by half nelson 2008-10-01 09:21AM | 0 recs
They are leading, just not in your direction.

by Travis Stark 2008-10-01 01:20PM | 0 recs

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