Bailout Bill: Obama Needs to Lead, Not Be One of the Bailout Bipartisan Musketeers

I've said it before, and I'll say it again: bipartisanship in service of bad legislation is not a good thing.

And, make no mistake, this bailout bill -- at least if the details that are trickling out are accurate -- is going to be very bad legislation indeed. And by that I mean very bad for the American people, whose interests are by no means identical to Wall Street's.

If Barack Obama goes along with it in the name of post-partisan comity, he's making a big mistake. Washington is not lacking political leaders willing to go along with the flow. It's lacking political leaders willing to lead.

"This is our moment," Obama keeps saying in his speeches. And this is his moment to lead, rather than to appear as one of the Bailout Bipartisan Musketeers ("One for all, and all for Goldman Sachs").

Could it be that he's surrounded himself with so many advisors who are looking at the bailout from a Wall Street perspective, he now sees it that way too?

Last night, he announced that he'd urged Democratic leaders in Congress not to pursue efforts to include an economic stimulus package in the bailout, or to push for a provision giving bankruptcy judges the power to rework mortgage rates because it might derail a deal.

That's the kind of thinking that prompted White House press secretary Dana Perino to applaud the candidates for trying to take the politics out of the equation.

But, as David Sirota, asks: "When did a crisis suddenly mean that giving away taxpayer cash is laudably apolitical, but spending taxpayer money on taxpayers is inappropriately 'political?'"

There has been a flood of irate calls and emails pouring into Congressional offices from people who are not buying George Bush's efforts last night to paint the bailout not as a helping hand to Wall Street but essential to avoid wiped-out retirement savings, rising home foreclosures, lost jobs, and "a long and painful recession."

There are rumblings that McCain may attempt to torpedo the nascent bailout agreement in an attempt to play the populist rebel. As Marc Ambinder puts it: "nothing says 'maverick,' like voting against Bush and standing with the American public, who remain very wary of the proposal." Rank and file House Republicans are also shaking their heads and muttering "no deal." So will it be Obama, as the standard bearer of the Democratic Party, making a deal that, in the end, adopts the overriding trickle down essence of the original Paulson plan: give Wall Street what it wants, cross our fingers, and hope that the crisis is averted?

Instead of siding with Bush and Paulson on far too many deal points, Obama should draw a line in the sand and refuse to cross it.

Voters are not looking for smiling post-partisan photo ops. They are looking for a leader willing to fight for a bailout plan that more directly protects the interests of the American people.

Comments

[Forethought]

Obama is more wise and more capable than anyone of us.
So please stop making reports based on "if" and "but" ...

"If Barack Obama goes along........"

[research]

It's incredible but true. I actually trust Obama.

[justice4juveniles]

Personally, I would rather each and every one of these failed mortgages be re-negotiated to what the person can actually pay instead of giving Bush and Wall Street the money. I would rather help my fellow citizen who may have come on hard times either through medical bills, job loss, reduced pay, or whatever the latest new screw job was that caused the failed mortgage, than help any of the extortionists that are trying to rob us of your hard earned money due to their greedy failures. Why doesn't Obama suggest something like this? He talks about being our brother's keeper, why don't we start acting like one? He needs to act on his words, which are very, very inspiring. Let's try them out.

[tower20]

I believe that the Paulson attempt to grab full unaccountable control of the $700B was a tactical smokescreen and that neither he nor the Bush administration ever expected it to fly. By putting it in their proposal they gave Congress a red herring to attack and got them to tacitly accept the overall concept of a time sensitive bailout. The debate on the whether the bailout should be supported at all was scuttled and legislators immediately got mired in haggling over the details. We should treat the entire proposal with the same suspicion and outrage as the now infamous "32 words".

Worst of all this proposed $700B bailout is merely a transfusion for a very sick patient. It does nothing to get to the root of the disease or stop the practices that got us into this mess. Why are we waiting to institute effective ongoing regulations and oversight of the institutions we're throwing money at.

The bottom line: this bailout rewards bad behavior and greed at every level from individual homeowners who made the risky decision to "bet" that the housing market would continue to go up, to speculative builders, to the largest banking institutions. I am appalled that the government is punishing those of us who acted with fiscal responsibility and restraint by forcing us to take on the massive losses of these speculators. Worst of all our children will bear the brunt of this bad, knee jerk, hurry up we can"t wait, policy for generations to come.

[pissmist]

Hello People anybody is here. Only way to bailout these burgular and thieves. We must find how much this companies cook the books and how money has stolen from poor people last eight years, and how much money was transfer to offshore banks. Obama must ask these questions and not to rush
to vote for these SOB's.

[greengrass]

"Washington is not lacking political leaders willing to go along with the flow. It's lacking political leaders willing to lead."

I hope Obama does not vote for it. This is where he needs to show us little people he can put his words into action.

[Lulliloo]

This is a tricky call. If there are enough provisions for periodic reviews and also on an ad hoc basis then Obama can go ahead and indorse it IMO. He's the one who will have to clean it up come Jan08.

[george99]

Excessive debt is the Kool Aid we have all drunk, only to find out that it is really poison. This Wall Street bailout is really an attempt to create another bubble using air this time rather than money. I suggest you watch how your representatives vote on this (Democrat and Republican) and take the appropriate action in the voting booth. That is all you will be able to do for the next 4 to 6 years. It is clear that all our current crop of law makers are in the Corporation tank.

[JessJames]

I agree with a comment made by Barry Goldwater Jr. regarding the bailout. Wall Street needs to take their haircuts.

[JessJames]

McCain: "Looked into Putin's eyes and I saw three letters, KGB."
Obama: he couldn't say anything because he has never looked into Putin's eyes.

[Forethought]

JessJames,
That's the difference in Obama and McCain.
McCain makes senseless comments to create hate and division.
Obama brings peace by making most logical and sensible comments.
By the way ask McCain to look in Obama eyes next time atleast when he is in a debate.

[THINKB4USPEAK]

Guess what? Trickle-down economics replay. The rich stand on their money, piss, and it trickles down on the rest of us.When people are living in mansions, vacationing in exotic locales, by doing nothing but run their mouths, while others are busting their asses to survive, producing the actual products that bought those luxuries, it's the fall of the roman empire all over again. Nero/Bush fiddles/cuts brush while Rome/America burns.

[JessJames]

Obama wants to be in one of those Mansions.

[Forethought]

JessJames,
Stop cynicism and say something constructive.

[wwwilly]

It's discouraging that in the coverage regarding the FDIC's THEFT of WaMu (WM) and its GIFT of the latter to J.P. Morgan Chase (JPM), there has been no substantive comment regarding millions of WM shareholders whose investments simply were wiped out at the whim of our government.

WM had sufficient cash reserves to continue operations for almost two years. WM also had among the best customer service/satisfaction records in the retail banking business, $300B+ in assets, and nearly $200B in deposits.

In contrast, JPM has higher derivatives exposure -- $90T+ (yes, TRILLION!) -- than ALL other U.S. banks COMBINED! JPM had virtually no cash available for expansion earlier this year when the Fed seized Bear Stearns (BSC) and "loaned" JPM $30B to "buy" it. Because JPM had written a lot of BSC's credit default swap contracts, had BSC failed, JPM itself would have incurred TENS OF BILLIONS in losses. In fact, a 10% loss in its derivatives exposure would wipe out JPM's ENTIRE ASSET BASE!!

So, here's the Fed again lending a hand to JPM ... and destroying the investments of millions of shareholders. *NEWSFLASH*: JPM has NO CHOICE but to keep "saving" its failing competitors; if its competitors /co-conspirators tank, the biggest loser could well be ... JPM.

The REAL loser in all of this: Individual taxpayers -- who not only stand to lose their investments, but also wind up paying for the "bailouts" of the greedy bastards who caused all of these problems in the first place.

[billw8017]

Huge sums of money to be spent with little or no oversight does sound like a plan for corruption. Furthermore, the bailout is a Republican driven cure while this Republican administration has fully demonstrated the fallacy of its economic theories.

Though it is basically a trickle down program, its size gives it trickle up properties and this may work like a big "stimulus" package. Failure favors the Democrats since voters will vote their pocketbook on November 4th, but even if it means losing, we can't wreck and ruin our country. it was one thing for a Republican congress to raise taxes and cut expenditures in an effort to hurt the economy in 2000, but Democrats aren't Republicans this way.

it is reasonable to provide to tread water until Democrats can take over, hoping this program will save just enough people to ameliorate the misery. Some problems are met best by enduring from day to day when more radical programs may be an unmitigated disaster.

[doneright]

I believe Barack Obama took the right approach in addressing the mortgage crisis. The crisis is the result of a failed economic philosophy. The philosophy is that free interprise is self regulating and the risk takers, motivated only by greed will produce the greatest national wealth. That wealth with trickle down to everyone. In fact, what has trickled down is more debt and deteriorating financial conditions.

Imagine playing a game without rules. It produces nothing more than a conundrum. Who is the winner? In fact, no one wins. The one's at the top become the rediculed and lose their job while the ones on the bottom pay for the damages. Adam Smith may have seemed brilliant in his day but today we should have the integrity of thought to know that it isn't true. There is no invisable hand. People have to take responsibility for maintaining a system that is fair minded and works evenly across the board. The greatest wealth for all comes as a result of the wealth being somewhat even divided. Excellence can and should be rewarded. Greed should be seen for what it is.

[billw8017]

You might profit from reading what Adam Smith actually had to say in 1776. He was not a neo con economic philosopher, but believed in an economy that was, at the bottom, moral. He wrote, among other things, that nobody suffers so much in a declining economy as the worker class, and the superficial splendor for enriching the rich is a sign of a country going most rapidly to its doom.

[doneright]

I'll admit that I stretched Adam Smith's contribution to economic philosopy up to its present application. The application of all philosophies get modified over time as the knowledge base changes. Still, I do not believe I did Adam Smith a disservice. The philosophers of the 18th century were big belivers in natural law and to make natural law a coner stone of econimic philosophy is a bit of a stretch in my opinion. There is no natural law that is going to guide society to do the right thing. Our political philosophy is based on the rule of law not the inherent goodness of mankind. If Adam Smith was referencing his theory to a moral society than what is there in is belief that would tend to keep it moral?

[sjohnnie5]

the economic philosphy was started by Clinton and endorsed by Dems to give everyone (whether they can afford it or not) a mortgage. Please do your homework before you blame Bush again and again and again. For people who keep saying Bush is so stupid, he must be pretty darn smart to accomplish all this stuff and get over on so many people. Make up your minds. Is he dumb or is he smart?

[doneright]

I never mentioned Bush in my post. Bush is a minor player in all of this. I don't blame Bush for much of anything. I blame the Right Wing machine that manipulated the election to get him elected. But more to the point, the philosophy that guides a society is more important than any one person. I don't think doing my home work would change a thing in my post. Maybe you should re-read the post.

[maryreilly]

What is this right approach he's taking on the financial crisis? The same one everyone else who's career is dependent on Wall Street support vs the interests of the American people is. What is he saying that addresses those concerns? He's aggressively promoting this bill which has no oversight, no pay caps - executive salaries are to be deferred for 2 years, not capped - and Paulson apparently promised Wall Street that no one currently holding a contract will be affected. WTF? is he going to cap salaries in the future for people not even involved in the bailout? Giving Treasury enomous unconstituional powers and hoping that bailing the people out who caused the problem, and are continuing to merge their companies so that in the future they'll be too big to fail, is the right approach? Taking out any equity for the taxpayers is up to the discretion of the Treasury as is helping any homeowners who may be foreclosed in the future.. No one will be prosecuted unless they've committed an "Constitutional" offense - what would that be, treason? It's probably the just the beginning of the payouts and the only thing for sure is that it will be helping people who've served themselves enormous helpings over the years and left the rest of us to pick up the pieces. This isn't change I can believe in, it's business as usual on the Hill.

[lion1]

This is not a 700 billion USD Bailout Bill. Its the Bush Administrations,700 billion USD Repayment Bill to Wall Street and US financial Institutions, which have bankrolled the Iraqi disaster to protect US business interest's.

Once again the Bush Administration, the Republican Party , Wall Street and the US financial Industry have violated the trust of American citizens in responsible business conduct. They all have pursued bankrupt policies to maintain their pride.

My suggestion to the US Congress and US Senate, CUT your losses in Iraq and RUN.

Establish the Sovereign Republic of Kurdistan.

It's dead logical.

Its the only solution to end the US Financial Crises

Post Comment Edit Cancel

[lion1]

The Bush Administration and the Republican Party need to go into the Guiness Book of Records for having conducted the worlds biggest financial fraud on the US financial system , ammounting to 700 billion USD.

This collosal fraud on the US financial system was conducted by the Bush Administration and their friends in Wall Street and the US Banking industry to pay for the US war in Iraq , which has cost Wall Street the US finacial system $10 billion USD a month, with only the energy barons of the US profiting from this financial disaster.

This US financial disaster has been going for 70 months , since the US military buildup for the US invasion of Iraq began in 2003, has cost the US financial system $700 billion USD. That means that the Bush Administration has robbed every US citizen which has invested money in Wall Street or US banks of 700 billion without the American citizens consent.

[sjohnnie5]

Then the Republicans really are BIPARTISAN because the people getting rewarded before and after this financial "crisis" are Democrats. Look it up.

[TomBrentwood]

I think you need to take this $700 billion sub-prime-mort-bailout package for what it is and move ahead. Make it for domestic industry, limit exec pay, and take equity positions like with AIG. The only other thing it needs to include is Oversight. That's what brought us to our knees.=No Oversight.
Otherwise we can debate this until all the banks go like Wa Mu.

We insure the bank deposits so we need to fix this now. Congress and the Executive branch of Govt have not been regulating industry so they are all at fault. Self regulation games like the one on the Front Page of Today's NYT's tells the old sad tale of the GOP mantra that has failed in epic proportions.
Other programs to bail out every homeowner can be debated for ever on the house floor.