The dust settles

By Seymour Klierly

The final weeks of Congress are typically spent feverishly working on appropriations bills. Such was not the case this year. Most of us watched the drama of the bailout plan unfold on television. First, the House rejected the plan and the stock market fell by the now infamous 777 points. Supporters of the plan immediately blamed House Republicans for the near $1 trillion loss in retirement and investment plans.

Two short days later, the Senate passed its version of the bill. After the Senate passed the new bailout, the House leadership found a few more votes to pass the $700 billion plan and voila, the economy would be saved...right?

While supporters of the bailout were quick to cite the drop in the Dow as a reason to pass the bill, they conveniently changed their tone when the Dow took an even larger hit after the bailout was signed into law. Instead of commenting on the continued Wall Street fall, they said the bank to bank credit crunch was a more appropriate measure of our financial system's impending doom; and thus the reason for their "yea" vote.

This may be true but the quick switch in the justifications for their vote leads an inquiring mind to question if the bill's supporters really understood what the new law would actually accomplish. Let's face the facts; Capitol Hill is not home to the brain trust of the financial world. Members must rely on input from staff, the administration and, most importantly, their constituents to explain the intricacies of the markets. Of these three groups, one thing is clear: members' constituents clearly and overwhelmingly opposed the bill. So much so that both the House and Senate phone and e-mail systems were shut down due to the vast number of constituent contacts. Many offices averaged over 1,000 e-mails and 100 phone calls per hour over a two-day period.

With such intense constituent opposition, perhaps there is another reason why so many cast their vote in favor of a plan that very few could explain. Was the pressure of accomplishing "something" in an election year influencing their judgment? There's no doubt that the weight of carrying around the label of the "do nothing Congress" is dragging down many members in their re-election bids. Senator Reid and Speaker Pelosi must have taken this under consideration before deciding to join forces with President Bush, the very person they are trying to link their opponents to every chance they get. The possibility of adjourning Congress without passing any appropriations bills, without addressing high energy costs, and without addressing the financial crisis simply was too much. Faced with this reality, the congressional leadership had to pass something quickly. The administration laid a framework on their desk and Pelosi and Reid saw it as an opportunity to get something out the door. Whether it would actually work or not was not for them to decide.

It will take a long time for the dust to settle on this bailout plan since it likely won't be implemented much before the election. If it doesn't work, supporters will quickly fault the outgoing administration and take no responsibility for putting at risk $700 billion of taxpayer money. If it does work, those same folks will publicly take credit for devising a successful rescue plan while privately offering prayers of thanksgiving for their gamble paying off.

10/13/08
6 Star Midwest Ag\4-B

Date: 10/8/08

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