Administration Official: Bailout Likely, McCain Lost PR Battle

Concerned that the public relations battle had turned against their favor, John McCain and the group of conservatives who opposed the outlines of the compromise financial bailout package will likely back away from their recalcitrance, an official close to the Administration tells the Huffington Post.

The Republican source, with direct knowledge of the negotiations, said that GOPers and McCain were "scared about the press perception" that they were at fault for "blowing the thing up." The takeover of Washington Mutual on Thursday combined with the continued downturn in the futures and credit markets "also scared them," to the point that a bailout deal seemed within the realm of possibility "over the weekend."

The official's tone - more optimistic than that of key figures just last night - signals an end may be in sight on a bailout negotiations. McCain has generally avoided taking a stance on the set of compromise principles agreed to by the administration, Democrats and many Republicans in Congress. But talks stalled during a White House meeting last night, in large part, sources say, because of a power struggle within the House Republican caucus.

McCain had left the campaign trail mid-week with a promise to force a consensus. But it seems, at this point, that he will have done relatively little during the negotiations - save for possibly killing the earlier arrangement and providing an opening for the opposition.

"I do think that John McCain was very helpful in what he did. I saw him this morning, we've been talking with his staff," House Republican Whip Roy Blunt told Andrea Mitchell on MSNBC. "Clearly, yesterday, his position in that discussion yesterday [at the White House] was one that stopped a deal from finalizing that no House Republican, in my view, would've been for."

According to one Democratic aide familiar with the negotiations, House GOP leadership was hoping to save face with more conservative members on Friday by forcing consideration (at the very least) of some of the alternative proposals - primarily, having the government sell insurance to companies that buy mortgage-backed securities. The leadership would then turn around and praise McCain for greasing the wheels on this front. But the course is problematic. McCain has left town. And during the White House meeting on Thursday night, Barack Obama reportedly brought up discussion of the conservative counterproposal only to have Treasury Secretary Hank Paulson declare it wouldn't work.

Comments

[jrterrier]

you guys have lost your mind. first you accept paulsen, bernake and W as the experts on the economy. this crisis happened on their watch. it's like relying on Cheney and Rumsfeld to propose a plan to turn the Iraq debacle around.

Pelosi and Reid, who last week wanted to impeach W (secretly if not publicly) now are pushing W's latest plan to transfer taxpayer money to well-heeled cronies.

and now you think that quoting an administration, with the lowest PR ratings in history, as experts on PR means something. hey, if this adminstration says that McC did bad in the publi relations department, that's a compliment.

[NicoleAnon]

Actually Bernanke and Paulson aren't responsible for this. I think they're probably corrupt and dishonest but this problem began way before they were around.

[FredOCal]

Yes it did. But what they have done is just as bad. In fact, it is far worse, for they have just in last week:
1) Tried, in the last week before congress recessed to campaign, to force a bill down our throats that would give Paulson dictatorial powers over the US economy, under the guise of saving us from collapse
2) Lied about the bailout bill and it's oversight procedures - http://krugman.blogs.nytimes.com/2008/09/23/good-ideas-and-lies/
3) Drained hundreds of billions of liquidity from the banking system since last week, causing major banks to fail in order to induce panic - see WaMu and Wachovia

They are criminals and need to be prosecuted.

[OdaNobunaga]

They sat by and let this crisis happen. That makes them culpable for it, even if they weren't behind it.

In criminal terms, its known as "Aiding and Abetting"

[RobinSeattle]

The problem for McCain is that he didn't lead at all, he was basically an inert gas. There were ice cubes at that meeting who did their jobs better than McCain did his.

[Pupster]

The crisis happened on their watch, and I'll be the last to defend W, whose gutting of the regulatory bodies and reckless de-reg frenzy created this mess, but Bernanke inherited this dud from Greenspan. Greenspan is target number 1 as far as I'm concerned, and he conveniently retired and foisted this debacle on poor Bernanke. Paulsen, well, he was CEO of Goldman during the critical years, but he has less culpability than many others.

If you're so anxious to cast blame, try to understand what is going on so that you can blame the right people.

[FredOCal]

Paulson wants to steal every last penny from you, your chldren, and your grandchildren. He made millions as CEO of Goldman during the housing boom, using the same mortgage-backed securities that put us here in the first place. Have you read his original proposal. Just for submitting it, he should be jailed!

[PaulLee]

Paulsen may have "less culpability" but how can you trust a guy who wanted no oversight of how he spent $700B. If he had any respect for the institution of government he would have been insisting on oversight. The man is unprincipled.

[sandpiper1]

Apparently Bernanke has a degree in economic downturn/c­risis...no­t sure of the exact term but the question I have is he's a expert on these types of cases, why didn't he see it coming?
Obama sent a letter to both Paulson and Bernanke about the potential mortgage crisis yet they did nothing. If Obama recognized it was coming to a head, how did they miss it...being too close to it, perhaps?

[Jetling]

The House Republicans' solution involves further deregulation, so spare me the BS.

Screw the derivatives, fi the underlying mortgages.

I know some will complain that we're helping people who got into bad loans. Well, helping the people who sold them the loans, then turned them around and sold them into the open market.

[papp1chu]

you forgot more tax breaks as if the country was not on the red and had a big surplus

[longislandlol]

Haley Barbour just said barack could charm the pants off a snake---

[AdLib]

Was that Haley's excuse for not wearing pants?

[justsomeguywhocameby]

LOL!

[anastasiabeaverhousen]

There's a mental picture I could have gone the whole year without.

[lovethesinner]

Why can't Republicans keep their pants on?

[BabsfromKansas]

hissssss

[apogee2perogee]

heh heh

[RobinSeattle]

Snakes wear pants? Whatever Haley was taking, Bush wants some!

[CaptainStormfield]

Haley Barbour would know snakes first hand.

[nutty4tahoe]

I say Haley Barbour could scare the pants off a snake!

[longislandlol]

At this moment Chuck Todd of intelligent news MSNBC (Mentally Sound, Nimble Broadcasting Company) is thrilling us dems with the news that a growing swell of conservatives are looking for a populist leader--- well== come on---- Huckabee was their man all along~

[williamg]

I always thought McCain should have picked Huck.

[lovethesinner]

Dump Palin, switch for the Huckster? (Danger Will Robbinson! Danger!)

[BabsfromKansas]

really, he looks like a heathen compared to the witchdoctor!

[DIdaho]

I like Huckabee. My only problem was he's a religious fundamentalist, but at least he's not blessed by witch doctors. At least he wouldn't have lost it for him.

[JoeBlough]

Huckabee is a Holy Man. He would be a rightous V.P.

[RobinSeattle]

Yeah, they just didn't vote for him.

And the money during the GOP primaries went to Ron Paul and Mitt Romney.

Huckabee will use his Fox tv show to build a bigger fan base (like Scarborough has been doing with his) and will be running in 2012, unless Scarborough declares for the presidency rather than the Senate.

[MaryanneAZ]

Call me a conspiracy theorist, but I have always believed that the primary win was "gifted" to McCain for his agreement to back off in 2000. How is it possible that a campaign that dried up and died, miraculously arose from the dead and trampled over Mitt's money, Huck's conservative christianity and governorship, and everyone else's pluses to win the nomination? It just does not seem possible that McCain's primary victory was a natural event that was won by a real contest unmolested by outside forces. I'm just saying....­........ I believe that Bush "owed" the run to McCain and promised it to him in exchange for his cooperation during his administration. Perhaps one day we will learn that I am right about this one.

[rabprevent]

mccain is insane and unfit for command!!

vote no to mccain and all his cronies, the republican party

[RobinSeattle]

Seeing how McCain is acting now, I am so glad the Naval authorities told him that he was in no way becoming an admiral. Can you imagine him having a naval command? Yikes!

And if he can't command even part of a Navy, he is unfit to be commander in chief.

[nutty4tahoe]

McCain's behavior then and now make it abundantly clear why the Navy told him he didn't have the right stuff.

Like George W., McCain is totally consumed with trying to one-up daddy (and, in McCain's case and maybe Bush's, granddaddy).

McCain didn't have the right stuff then.....a­nd he certainly doesn't have it now.

[apogee2perogee]

He graduated 894th in a class of 899. That is all one really needs to know.

[thinkworklivelove]

McSame STUNK it up in Washington. He should go down in history as the worst Presidential candidate along with his buddy Bush as the Worst President! No way, No how, No McSame and definitely NO PALIN!

[35Echo]

ROY BLUNT (R)Mo,: Clearly the Democrats have a majority in both houses of the Congress. If they want to do this by themselves, they can do this by themselves any minute they want to. If they want to do this with us, we're prepared to have that negotiation.

Inquiring minds want to know. Why didn't the Dems call a vote, pass it and make it LAW?

[apogee2perogee]

Why hasn't McCain expressed an opinion on plan content?

[justsomeguywhocameby]

I'm from MO and I think Blunt is an embarrassment.

[JoeBlough]

He still hasn't read the two and a half page proposal.

[OdaNobunaga]

Because his staff has not written his opinion for him yet.

[BlueOnBlue]

Because the Dems don't want to be the only ones doing the right thing for the country while the Republicans demagogue and blame them for giving in to Wall Street.

Sometimes the bills come due and they have to be paid. This time, it's this bailout. Nobody likes it, but there have been years of Republican deregulation of the financial industry and the bill is now due.

[mcpalin]

For very good reason, actually. The Republicans and their deregulation program caused this fiasco, they are going to have to (by and large) sign on for the bailout. Otherwise, a year or two from now, when people are really pissed off about having to pay for this, the Republicans would be (seriously, even though it defies logic and reality) declaring that deregulation had nothing to do with causing the fiasco, after all, they're all mavericks and reformers and it was really those anti-government deregulators the Democrats who allowed all that deregulation legislation to pass and moreover told the Republican administration officials not to enforce what little regulation did still exist, and oh by the way, we didn't agree to that bailout package, you can blame the Dems for that, too.

THAT'S why the Republicans had to sign on, too, and rightly so. When the public becomes even more angry about paying for the cleanup of this mess, no finger pointing at one party, they can blame BOTH of them (and preferably, the ones who set us up for the fiasco in the first place).

[apogee2perogee]

Some of the tr0lls try to make that silly assertion now.

[CaptainStormfield]

Its a suckers game that why.

[35Echo]

And the RePub's didn't take the bait.

[CaptainStormfield]

In 2002, Blunt attempted to insert a provision, in support of tobacco corporations, into the legislation that created the Department of Homeland Security. The "rider" would have made tobacco sales over the Internet more difficult, allowing tobacco companies to control distribution. At the time, Blunt was dating Phillip Morris lobbyist Abigail Perlman, whom he later married. It was removed from the final bill by agreement between Blunt's staff and the Speaker's staff.
Citizens for Ethics released a report in June 2007 in which they pointed out that two of Blunt's children are lobbyists in addition to his wife.[23] Altria Group has made a $180,000 contribution to Blunt's PACs and is the largest donor to Blunt's campaigns, giving Blunt a total of $270,000 as of late 2006.[24] Son Andy Blunt is a lobbyist who has worked for Altria subsidiaries Kraft Foods, Miller Brewing, and Philip Morris, along with UPS. Blunt inserted a rider into an Iraq War appropriations bill in 2003 that benefited UPS.[23] Daughter Amy Blunt is a registered lobbyist for Lathrop & Gage.

[StateofTaxes]

After watching and listening very closely these last few days, to this McCain fiasco(for lack of a better word), I almost think I see a pattern here by him and his "campaign managers(also, for lack of a better word); if they can't come up with a plan to do what they do best: STEAL this election,and it's not looking very good for any other chance to win it; he is setting up his face saving scenario; "I lost this election because: I saw my country in a time of great need, and I answered the call; leaving my campaign and did what I had too(unlike my opponent..­)"let others judge me as they may..., Blah,Blah, etc.!
Maybe there is a method to his madness? Or, of course, he's just plain whacko.?

[BabsfromKansas]

yes

[CintiBlue]

He didn't get his joint Town Hall meetings.

[Manchurian]

Even the hard core right wingers wouldn't buy that line ("I lost this election because.."­). Though I wouldn't be surprised if McCain tried it.

[PT6]

McFlipFlop is back on his message of the LAST 26 YEARS.

All that STUFF ABOUT CHANGE AND REGULATION WAS TOO CONFUSING FOR HIM!

So expect the McDeRegs of OLD!

[ggmome]

Is there a special reason to hold this debate in Mississippi?

[AdLib]

According to McCain, because it's near the Pakistan border.

[BabsfromKansas]

hope they don't fly into our air space

[Biffmeister]

Now that's funny.
Don't you mean Palin, though?
Wait...Tha­t's right, Palin said she could see Pakistan from the Mississippi border.

[brenner21]

plans have stalled "due to a power struggle within the GOP"? I recommend that the writer read this: http://www.politico.com/news/stories/0908/13789.html ...rank-an­d-file GOP house members told Cheney "No thanks."

then I turn on C-Span & the House is voting on an amended bailout plan: 201 YES votes from Democrats! Vast majority of NOs from Republicans. Who are these "Democrats"? They talk of the "Middle Class" (what's that? a Wal-Mart cashier?), children without health care, the underprivileged. Then they sit round that big table with Bush. Give the Republicans credit for honesty: they won't have anything to do with the poor!

Barack Obama called up McCain the other day, who got on TV first. What was he thinking calling McCain? He may not be so smart, despite his Harvard wit & urbanity. His campaign has sought to paint McCain as another Bush. There he was sitting with both of them: If he loses it will be his own fault.

He should have said: "I refuse to believe anything that the President says" along w/80% of Americans.
No $700 billion for Bush's Treasury Secretary Hank Paulson, who's previous job was co-CEO of Goldman Sachs, where he helped cause this mess. I wouldn't him 2 cents. When asked whether there would be help for homeowners facing foreclosure and the vert real prospect of being homeless, he said "NO."

[schatsie]

Barack is probably listening to Robert Rubin and Greenspan, the people who were cheering on this train wreck...

I want to hear what Stiglitz has to say about this mess...Rob­ert Reich has already come out with the populist and root cause solution..­..

[jrterrier]

you got that right. instead, it's going to be mccain who is going to be able to say (to quote brenner21): "I refuse to believe anything that the President says" along w/80% of Americans. No $700 billion for Bush's Treasury Secretary Hank Paulson, who's previous job was co-CEO of Goldman Sachs, where he helped cause this mess. I wouldn't him 2 cents. When asked whether there would be help for homeowners facing foreclosure and the vert real prospect of being homeless, he said "NO."

[Pupster]

You don't get it. This bailout in some form or another is necessary. You don't have to like it, I certainly don't, but unless you want a complete collapse of the financial system, a worthless dollar (like Zimbabwe worthless) and utter Lord of the Flies chaos, you will stop your conspiracy theories and try to understand what is going on. This is bad. Really really bad. There're plenty to blame for the mess, but right now, everyone has to suck it up and take a bailout.

Obama did the right thing. He showed up because he had to. Taking his ball and going home is not an option. I'm glad he and the House Dems know the seriousness of the situation, even if you don't. The House Repubs are buffoons. They are all car salesmen and dirt farmers who have no idea how vast the credit markets are and how critical they are to running the country. They need to get their heads knocked together and fall in line.

If they don't have a bailout, forget about your bank accounts. WAMU failures everywhere, except no one will be in a position to stand behind the deposits like JP Morgan did for this bank.

The worst part of the Bush/Cheney freakshow is that they have yelled wolf so many times that now that the wolf is actually at the door, no one frigging believes them. Sadly, believe it. It's bad out there and the bailout is absolutely necessary.

[ObserverinVancouver]

One thing I've noticed from many years of watching Americans from a distance is that they hate seeing their president dissed. (Yeah, I know this seems counterint­uitive.) If Sen. Obama had said thanks but no thanks to this meeting he would have been metaphorically slaughtered for his rudeness, lack of respect for the office of the President of the United States, and general lese majeste. Going was definitely the lesser of two evils even though it was a set up. And it sounds as though he handled the meeting well despite the ridiculous Republican attempts to smear him as presumptuous and political (wink, wink).

[helen]

I feel like I'm watching the movie "Dumb and Dumber"...

Please someone make McCain go back on his meds...

[AdLib]

More like "Dumber and Dumbest".

[gobarackgo]

McTrainwreck careens out of control again.

[J.J. Hunsecker]

In the newest dramatic gesture hatched by his campaign masterminds, McCain plans to show up for the debate dressed in his P.O.W. duds. This will unnerve Obama and cause him to lose the debate, they figure.

[Okieborn]

Nothing is surprising for this Creep !!
Paulson was counting on a free hand with 700 billion, part might have been used for his retirement package !!!

[NicoleAnon]

1) Why did the government take over a major bank THE SAME DAY that they started to lose support for the bailout? Was it to create more panic because they realize almost ALL Americans are against this?

2) Why was Lloyd Blankfein, the CEO of Goldman Sachs, allowed to meet with members of congress this week telling them they should support the bailout and the only major newspaper that mentioned it was the WSJ on the back page. And this is a bank that has already requested they be paid "fees" to "manage" the toxic assets that taxpayers paid for.

3) Why is Warren Buffett telling everyone "Heaven help us if this bailout isn't approved" which is the EXACT SAME WORDS that Paulson used last week now that he owns GS stock? Why isn't WB telling people how many stocks he owns in banks? I happen to know for a FACT he owns many and will make BILLIONS from this bailout.

4) Why did over 200 economists sign a letter to Pelosi saying the bailout was a mistake and nobody in congress is mentioning it?

5) Why won't they tell us if Paulson really did sell his GS stocks or if they're in a "blind trust" for him that he has access to when he leaves the government?

6) They're about the pull off the biggest heist in American history and yet there aren't many protests or demonstrations - why aren't angry people standing outside the doors of congress protesting

[schatsie]

You are absolutely correct... We have just seen the tip of the iceberg, if the doors open to Wall Street, we might as well call ourselves the UNITED STATES OF MEXICO....­The Canadians will be closing their border so we cannot go to a place of sanity...

Waiting for Michael Moore to really nail this mess, and get Robert Rubin out of the kitchen, he helped cook up this mess in 1999 and 2000....

[NicoleAnon]

And Robert Rubin used to work for...take a guess...Go­ldman Sachs.

[justsomeguywhocameby]

I heard the Mexicans are rushing to finish the wall along the border to keep us out.

[CBS]

Did anyone think this was more than a stunt???? He is channeling an SNL character.­..

http://www.sfbaysailingpix.com/pez2008p1.htm