This morning the President will make another speech to the American Public. As I write this it is about 2 hours away. Whatever he says, it is doubtful that it will be listened to by the members of his own party in Congress and I’m not sure what he can say to get the public to push back for his solution to the problem. His speech yesterday didn’t do it. Why should today be different.
The reports this morning from the global markets are not pleasant. Prices are dropping world wide. The Russians actually had to close their market to prevent a disastrous stock price fall.
The Dow dropped yesterday more than the bailout package would have cost. That should make everyone wince.
While Congress doesn’t meet today as members get to go home for the Jewish New Year, hey will be back by Thursday and have to get on it again (the Senate is supposed to vote on the package tomorrow.) The key to getting this through, however, is the House. After all, only 1/3 of the Senate is up for re-election in 35 days… but ALL of the House is, and they are going to put their constituent’s views ahead of what would, painfully, save the economy. It has been said that calls to Congress from constituents yesterday were running 100 to 1 against the bill as it stood.
So what will happen this week? How much lower can we let the markets fall?
Steve Clemons thinks it will significantly change our country nd its influence in the world (he also thinks it will end the war in Iraq – for economic reasons!):
America will have no choice but to add to its cumulative debt — and to invest in itself, particularly national infrastructure — as a way to keep Americans working and to stimulate important parts of the near and long term real economy.
George W. Bush’s demands early in his administration for unprecedented powers and budgetary authority amidst unprecedented secrecy and non-transparent government was never effectively challenged by the Congress that should have fought for its own constitutional prerogatives nor knocked back in any real way by the full force of the Democratic Party.
But now the marketplace of power in the world and of the global financial order has brought this administration to a devastating conclusion to its influence — and Americans are going to pay a long-term price for the reckless stewardship of America’s economic and security portfolios by this administration.
Robert Reich is predicting a scaled-down bill by Friday:
It will provide the Treasury with a first installment of $150 billion. Treasury can use it to back Wall Street’s bad debts with lend no-interest loans of up to two years, until the housing market rebounds. Or to invest in Wall Street houses directly, in exchange for stocks and stock warrants. There will be strict oversight. Congressional leaders will promise further installments, but with conditions calling for limits on salaries and relief to distressed homeowners.
Paul Krugman probably looked at the situation pretty realistically:
I assume Pelosi calls a new vote; but if it fails, then what? I guess write a bill that is actually, you know, a good plan, and try to pass it — though politically it might not make sense to try until after the election.
Whatever does happen, it is not going to make everyone happy.
