No Future for You.
A seven-hundred-billion-dollar bailout plan? Weren't Republicans supposed to be opposed to deficit spending? Weren't they the party that was all about balanced budgets and fiscal responsibility?
That's what Republicans say, of course. And now they tell us they wish they didn't have to take this course; that the bailout violates their own first principles; that they're so, so sorry. But none of this is true. At some point in the first Reagan administration, Washington conservatives (as opposed to your average conservative pundit or grassroots activist) learned to stop worrying and love public debt. Maybe that first, gigantic deficit the Reaganites piled up was an accident, just a combination of deluded "supply side" tax cuts and a huge bag of good stuff for the Pentagon. But pretty quickly conservatives discovered that deficits, when done correctly, did something really cool: deficits defunded the left.
For one thing, deficits gave the Reaganites an enormous weapon to wield against their enemies in Congress and the executive branch. Having to pay down the debt was the excuse for "reductions in force" in agencies detested by conservatives; it was the rationale for attacks on this liberal program and that; and it was--believe it or not--the original justification for the trademark conservative innovation of outsourcing and privatizing public operations, an innovation that has, as we now know, turned out to be one of the most fantastic money-burning frauds ever conceived by the mind of man.
And then, of course, the whole thing was dumped in the lap of the incoming president Bill Clinton in 1993. The story is so famous it borders on legend: One fine day, after being briefed by his economic team, Clinton realized that, thanks to the deficit, he would not be able to enact most of the economic program he had been promising voters throughout the campaign. He cursed. He screamed. He referred to it as "Stockman's revenge," after President Reagan's budget director (whose memoirs are an invaluable account of conservative thinking about deficits). And, of course, he did as the situation bade him: he balanced the budget and ruled like a nice, responsible Republican.
When done right--or wrong, depending on how you look at it--deficits remove liberal options from the table. Suddenly there's no money for building bridges or inspecting meat. Not surprisingly, running up a deficit is a strategy favored by the wrecking crew for its liberal-killing properties.
But seven hundred billion dollars, all of it to make Wall Street whole again after it cheated and deceived itself into its worst crisis in seventy-five years? Add this to the already enormous deficit Bush piled up by sluicing waves of public money down the pipe to whatever contractor has the best lobbyists, and you're talking deficit Armageddon.
And with a deficit that size, what a lot of defunding we'll have! Perhaps your individual share of the bailout will be manageable, but its larger effects will take much more from you than you think: public schools, workplace safety, health care reform all might well be sacrificed.
These gratifying effects are already being acknowledged. On Tuesday Barack Obama recognized that the bailout may crowd out some of the programs he's been promising on the campaign trail. Yes, I know that something has to be done to avoid Great Depression II; I know we have no choice in the matter; and I don't even have a problem with deficit spending in the abstract. But it seems to me that the combined result of all this might be to compel even Obama into acting like a Republican.
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What still amazes and amuses me, is how many Reps say our economic crisis is the fault of Democrats! Who has been in the White House the last eight years? Where does the buck stop? The Bush Admin has had a loooong time to see this coming, and instead of stopping it, contributed to it.
I read a blog (on bloomingtion I think) by a McCain advisor that blamed FDR. He was President 80 yrs ago!
That would be correct, don't you know that Social Security and Medicare are ENTITLEMENT progams...Not that we paid for them out of the Payroll taxes which have run 150 billion surpluses...
Those Payroll tax surpluses were what Bush used to give the Rich one trillion dollars in tax reductions this past 8 years..
Could someone explain as I am other than american thank god at this stage of the game. What would happen if John McCain became incapacitated and couldnt continue to run for president.
The grandstanding by the Reps is their way of trying to save their careers, and it should be enough for the moment in many cases (any district that is Rep is a dumb district and easily fooled).
Even so, over the long run it is going to be very hard for the Reps to save themselves, even with the solid support of the religious far right. From now on, things are going to get worse for everyone - not just the poor people the Reps hate, but the Reps will be hurting too. Especially young people without very rich fathers are going to be hurt as the supply of new jobs dries up. This may go on for decades, and eventually the Reps won't be able to fool anyone. Every young person will know who did it to him or her.
W. is already the Hoover of this generation. For those who remember Hoover and FDR, the opportunities for Obama appear unlimited, but of course now being old doesn't seem so bad. That's why Bill and Hillary look so relaxed these days.
HuffPost's Pick
The Republicans always seem to cry "socialism" whenever there is talk about universal healthcare or anything related to helping the overall good of the people or the poor. Now they conveniently want that very public to bail out some of the richest people in the country. It seems like a form of Socialistic Capitalism to me; where they keep their money when they make it, but, when they become greedy, screw up, and loose, the public should conveniently step in and bail them out. We have privatized gain and socialized loss – this does not seem like a “free” market to me. These rich executives will keep living in their expensive homes and drive expensive cars while the regular folk, who have little position in the market, will pay for their follies. Who is bailing out the hospital closings in Queens? Do you ever hear anything about these big moneyed institutions bailing out other organizations that care for everyone and not just those who invest in them?
So tell me, what is in it for us? Will we all get some share in these companies as a reward for helping them during, what you may call it, the “rough patch”? We got nothing the last time for bailing out the Savings and Loans debacle, and, most probably, we will get nothing now. Don’t worry, they’ll conveniently find a way to blame it on the minorities or anyone else other than themselves. Let them deal with it!
No need for a bailout. Let these firms fail. There are laws in place to handle this. As for housing, it's artificially high so its good that home prices are going down.
Whin I look at the chronology of this bailout I see the D's simply playing football to their advantage.
1. Bush wants everything with no oversight, so
2. The Senate D's write a bill giving far le$$, and with a lot of oversight, then
3. The house R's can't go along, so
4. compromise legislation is arived at by this Sunday?, and
5. The vote on Wednesday will not go through, so
6. The bill goes back to the Senate for revision. Meanwhile,
7. The House version does not agree with the Senate version,
8. Etc., Etc., Etc.,....
Football!
It may be bogged down till after the election, especially since the biggest problem, WaMu, has been dealt with.
We need to bail out Wall Street? No we don't!
Obviously they really don't need it very badly because they keep resisting regulation, control, the government taking a stake in equity, and charging them for the loans, cutting CEO's pay... so obviously it is unnecessary.
Another depression? No one knows. But in My Trailer Park I have infinite faith that we will survive. We will use our skills to barter. I have been shopping secondary markets for years. It doesn't hurt, it is efficient and cheap. Some of us will rag-pick, make things, fix things, collect cans from the side of the road, some will play music and some will dance, but the people I know will survive, they are innovative. The people I live around don't care about Wall St, they don't have money to pay for medicine or insurance, the only reason for a checking account is to pay for things that only take a card-- another tyranny perpetrated on the poorest among us to collect fees-- so go ahead and ask: do they care about the rapaciously greedy fools on Wall St?
So the tax base goes to 22percent on ALL, quid pro quo, nationalize health care, medicine, child care, education, pay for our children to go to college, subsidize housing, protect citizens from corporations' and energy companies' greed and tyranny, nationalize the gas and oil companies, they drill on Public Lands, give citizens the benefit.
Just a View from My Trailer Park.
MJ Richards
Exactly. The basics don't cost much. We can all huddle together for warmth and figure out a way to get through while these parasites collapse and the Democrats get us back on track.
I hope the crisis looms until after the election. We should let the Wall Street companies that made bad investments fail. Other solvent entities whether domestic or foreign will step in and buy up their assets at bargain basement prices (see WaMu). Instead of bailing out Wall Street we should use the $700 billion to do all the things Obama has been promising on the campaign trail. He should incentivize the remaining solvent banks to participate in the rebuilding of the infrastructure, developing alternative fuels, growing the green economy, and retraining the American people through education. He may not even need to raise the taxes on the rich. If America can be convinced to swallow $1 trillion in deficit spending to bail out the rich then we ought to be able to sell the same thing for bailing out all of America.
Huge national debt or not, we spend as much as our will will allow. Money we don't have at our desposal is being spent every year as a part of the budget. Our budget is money we don't have. Democrats know this too. There is nothing compelling them to cut social spending any more than money we can't afford to allocate elsewhere, like a war, for instance. Well, there is one thing: They don't mind cutting social spending, and spending money we don't have on war. The two parties are exactly the same.
BEWARE!!!
THE WALL-STREET BAIL-OUT IS A TROJAN HORSE
AND THE OCTOBER SURPRISE conceived by Republicans to set-up the Democrats for defeat in November.
IT IS STILL THE ECONOMY STUPID.
If this ill-conceived plan passes with mainly Democratic Support
and with less than 75% Republican Support, the Republicans
will USE this to defeat Obama and House & Senate Democrats.
IF the ill-conceived bail-out DOES NOT PASS,
the Republicans will claim credit for defeating it..
THIS IS A LOSE-LOSE SET-UP FOR DEMOCRATS
IF THE DEMOCRATS ARE SEEN AS INSTRUMENTAL IN
SUPPORTING AND PASSING THIS BILL.
The DEMOCRATS should lighten up and not push this bill.
Let the Republicans write the bill. Democrats should vote NO until, if ever, the Republicans write a bill that is acceptable to Democrats.
If Democrats get the blame for passing this bill, Karl Rove will be laughing all the way back to the White House.
My greatest fear is the National Debt which is now almost $10 TRILLION dollars, a debt of over $30,000 for every American. The last thing we need is another $700 billion added to the National Debt , about $2500 for every American. American is close to BANKRUPTCY. We can't afford to increase the debt by another trillion.
Under Republican presdidents, 92% of the National Debt has been incurred and only 8% under Democratic presidents...and the Republicans are "supposed" to be conservative???
That's interesting. I see all of these articles on Huffington Post about how the Republicans are holding up the bailout bill. But Mr. Frank tells us that bailout bill is actually part of the Republicans strategy to screw over future Democrat administrations.
Well, which is it?
BOTH and then some!
NO MORE YEARS
for corrupt Republian liars and crooks.
Republicans PROVED that they CAN'T GOVERN.
I cannot trust them at all.
My vote's for common sense, responsibility. Obama-Biden.
The House GOP leadership and McCain are jacking us all around for their own benefit. That doesn't undermine the argument that the wrecking crew, since Reagan, has been deliberately blowing up the debt to tie the hands of liberal presidents.
Maybe a less generic term than the catch-all 'Republicans' would help clarify the problem. For example, it's just as true, but a degree more obtuse, to say, "Americans are holding up the bill, but...the bailout bill is actually part of the Americans's strategy...."
My friends, the divide-and-conquer habits of the human mind are hindering our democracy. Aren't we all Americans, and beyond that, Earthlings? Or are some of us more favored by the natural order of the Universe (eg., White Man's Burden, Manifest Destiny, etc.)?
Rove explicitly is working for a permanent Republican majority, ie, one-party rule. Isn't that the opposite of what the founders intended? How can the Republican Right, the Washington Conservatives, be so insanely selfish? Or do they interpret Jefferson as meaning, "All men just like me, and nobody else, are created equal, and thus deserving of the beneficence of governement"?
Continuation because I am a wordy old babe.
5 Problem is we can all chime in and I have done so too but these are people who are willing to get down in the mud and fight and we gotta back them. Something has got to break this miasma of uncertainty and fear before it turns into absolute panic. Do we need to prop up Wall Street, I don't know. I do know Paulsens plan is CRAP and so I emailed No Bailout because it is disgusting
Shut 'em down. Don't bail out Wall Street Thieves. Make the CEOs & the CFOs and the boards pay it back out of their own pockets. I don't care how you do it. Round 'em all up and haul 'em off to Gitmo!
The republicans are already demanding another tax cut; suspend ALL TAXES on Capital Gains as their price for the bailout.
Don't do it.
If we really need to bail out the economy, let the republicans be the ones to raise taxes on the rich to pay for it.
Filibuster until then.
Good post, but I must disagree somewhat. These deficits, though large, are still manageable. He needs to raise taxes on the wealthy more than planned, enact a tax on every wall street trade, pull our troops out of Irag, raise the minimum wage so more people in the lower income scales pay income tax, take the cap off of social security taxes so it will not raise deficits in the future, raise corporate taxes, etc. His first priority is to raise revenue not to cut programs.
Well said. I think between good oversight and pounds of flesh extracted by Democrats as the price of this deal, and a few wise and easy steps President Obama can take with the help of a Democratic congress (and you'd better believe the Repugnicans will take heat for standing in the way of them), the whole thing can be straightened out.
Ruy Texeira's "The Coming Democratic Majority" looks interesting. I haven't read it yet, but have seen the outlines of its argument, and I think it's solid. We should be able to get this country back on the right course over the next few years, barring some very unlikely outcomes to this idiotic "bailout" stunt.
Perhaps David Letterman could have a banker come on his show and explain the fundamentals, so Congressmen and women can watch and understand what their thinking about.
Then they should read the legislation.
Mr. Frank, I owe you a deep debt of gratitude. I love your phrase, "the wrecking crew."
How is their MO any different from that of the master propagandists of the last century? They declare a threat (imaginary threats, being impossible to disprove, are preferred), and denounce the opposition for lack of patriotism and exposing the country to an existential threat.
I wish I could believe it'a only the Republicans who practice this most nefarious method of social engineering. Journalists like Alan Nairn, though, who detail the bipartisan nature of our expoitation, convince me otherwise. I fear that some Democrats are in on it, too, esp. the Congressional leadership.
I think that explains Pelosi's decision, to take impeachment off the table. The D.C. Democrats collaborated or were deceived to a degree they now find impossible to reveal.
Nixon used Mrs. Chennault to stall the Paris Peace talks at the end of the Vietnam War. Lyndon Johnson and Hubert Humphrey, when they learned of this treason--leading directly to the deaths of over 20,000 US servicemen and many times more Indochinese--they took the secret to their graves. It's said that they feared the country couldn't take that revelation.
That was not their decision to make, Nixon made it for them by behaving so despicably. When a democracy deprives its sovereign, the People, of the truth, it signs its own death warrant.
And when it deprives the People of education, it pulls the trigger of the gun pointed at its own head.
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