If you have "no place to go," come here!

No deal

[UPDATE Can we have the Incredible HOLC now? -- lambert]

[UPDATE Oddly, or not, nobody that I can find is framing this as a victory for the American people, who were overwhelmingly and vociferously against this bill. -- lambert]

[UPDATE Keep calling your representatives, either to thank them if they did the right thing, or to chastise them and offer alternatives if they did wrong. -- lambert]

[UPDATE McClatchy gets it: See below. -- lambert]


By a vote of 205-228, the House has killed the current version of the $700 billion Wall Street bailout bill.

Well! Nice work, Nance. You too, Barry.

What now?

I expect our experts in strategic behavior will inflict more shock and pain in service of their greed. But I think they have some "Step One" work to do.... "We admitted we were powerless against the aroused American people." Then, maybe at some point, they could do that "fearless and searching moral inventory" thing.

UPDATE Lord Kos has not claimed the victory for Obama, even though he applauds the result. I suppose he's waiting to see which way the pundit wind blows before doing that. Conviction!

UPDATE Obama, dancing with who brung him, blames partisanship. Hilarity ensues.

UPDATE Krugman blames the House Republicans, says we've become "a banana Republic with nukes." Which I'd agree with, since given Bush + Reid + Pelosi + Frank + Obama + Paulson I might as well be wearing my underwear on the outside -- were it not for the overwhelming popular opposition to the plan. The case could be made that the country, after being a banana republic (if that) for the last eight years, finally took a step toward democracy today.

UPDATE Wall Street drops. But as I said somewhere today, if it takes an act of Congress to support the Dow, then we, or at least they, are fucked anyhow, come what may.

UPDATE Stirling has a plan: A shot of adrenaline to get us through to January. I like the slogan: "Too sick to lend is too sick to live." That should turn some bankers liquid. So does Ian (hat tip, CD).

UPDATE Via McClatchy:

For once, Congress heard as voters protested bailout plan

Almost until the early afternoon vote Monday on the financial rescue plan, voters bombarded congressional offices, protesting almost in unison: Don't bail out renegade financial executives and companies.

On Monday, House members, who face the voters in five weeks, listened to their constituents rather than their party leaders and rejected the $700 billion financial rescue package. For many, it was just too much to swallow too quickly, and too hard to explain.

Most House members said, "I want this thing to pass, but I want you to vote for it, not me," explained Rep. Paul Ryan, R-Wis., who voted for the bill.

Most lawmakers knew that what had happened was something much more fundamental: Members voted to please the folks back home, not their leaders in Washington or the titans of Wall Street.

"This is the same politics of fear we are hearing from the fat cat financial bullies from Wall Street," said Rep. Ted Poe, R-Texas, who voted no.

Rep. Jeff Flake, R-Ariz., recalled how many people voted for hard-to-understand measures such as the 2003 Medicare prescription drug bill or 2002 legislation giving President Bush broad authority to wage war in Iraq, only to learn later that they'd signed blank checks to Bush that would come to haunt them.

"There were a lot of eyes rolling on this bailout. We're heard this kind of thing before," said Flake, who voted no.

And what's next?

The Senate, where only 34 of 100 seats are up on Nov. 4, is expected to pass the legislation easily. After the chaos Monday in the House, the Senate's mood was calm, and people remained upbeat about eventual passage.

"A lot of people have misgivings," said Sen. Tom Coburn, R-Okla., one of the Senate's leading conservative voices. "I have a lot of misgivings, but I'm still going to vote for it."

Well, I guess we're going to have to make the Senate upset, then.

No votes yet


Submitted by lambert on

See Roubini; there are a lot of policy options. Just this one is not, er, ideal:

A recent IMF study of 42 systemic banking crises across the world provides evidence on how different crises were resolved. First of all only in 32 of the 42 cases there was government financial intervention of any sort; in 10 cases systemic banking crises were resolved without any government financial intervention. Of the 32 cases where the government recapitalized the banking system only seven included a program of purchase of bad assets/loans (like the one proposed by the US Treasury). In 25 other cases there was no government purchase of such toxic assets. In 6 cases the government purchased preferred shares; in 4 cases the government purchased common shares; in 11 cases the government purchased subordinated debt; in 12 cases the government injected cash in the banks; in 2 cases credit was extended to the banks; and in 3 cases the government assumed bank liabilities. Even in cases where bad assets were purchased – as in Chile – dividends were suspended and all profits and recoveries had to be used to repurchase the bad assets. Of course in most cases multiple forms of government recapitalization of banks were used.

But government purchase of bad assets was the exception rather than the rule. It was used only in Mexico, Japan, Bolivia, Czech Republic, Jamaica, Malaysia, and Paraguay. Even in six of these seven cases where the recapitalization of banks occurred via the government purchase of bad assets such recapitalization was a combination of purchase of bad assets together with other forms of recapitalization (such as government purchase of preferred shares or subordinated debt).

In the Scandinavian banking crises (Sweden, Norway, Finland) that are a model of how a banking crisis should be resolved there was not government purchase of bad assets; most of the recapitalization occurred through various injections of public capital in the banking system. Purchase of toxic assets instead – in most cases in which it was used – made the fiscal cost of the crisis much higher and expensive (as in Japan and Mexico).

Thus the claim by the Fed and Treasury that spending $700 billion of public money is the best way to recapitalize banks has absolutely no factual basis or justification. This way of recapitalizing financial institutions is a total rip-off that will mostly benefit – at a huge expense for the US taxpayer - the common and preferred shareholders and even unsecured creditors of the banks. Even the late addition of some warrants that the government will get in exchange of this massive injection of public money is only a cosmetic fig leaf of dubious value as the form and size of such warrants is totally vague and fuzzy.

So this rescue plan is a huge and massive bailout of the shareholders and the unsecured creditors of the financial firms (not just banks but also other non bank financial institutions); with $700 billion of taxpayer money the pockets of reckless bankers and investors have been made fatter under the fake argument that bailing out Wall Street was necessary to rescue Main Street from a severe recession. Instead, the restoration of the financial health of distressed financial firms could have been achieved with a cheaper and better use of public money.

Also, remember Newberry's idea that this is all coming from greed, instead of (as we are told) fear.

Nobody knows anything.

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

pie's picture
Submitted by pie on

I was outside doing yardwork and just came back in.

What happened?!

Submitted by WRhouse on

after they realized it wasn't going to pass. And yes Lambert, they are pushing the "Fear, Panic, Doom" buttons hard ( NBC that is.) Oh and as a nice touch they interrupted the "Martha Stewart Show" to warn everyone of the end of the USA.
"Our country right or wrong. When right, to be kept right; when wrong, to be put right."
Carl Schurz - U.S. Senator 1/17/1872

BDBlue's picture
Submitted by BDBlue on

Roubini has pointed this out. The market fell after AIG was bailed out and it's been falling even as Washington was promising $700 billion. Why? Because the proposed plan won't work. Investors know it. The only people pretending it will work are those with their hand out (either for the bail out of campaign cash).

The system is close to crashing, but the solution being offered isn't a solution. That's the problem. I understand that there are real problems out there and, under the right conditions (HOLC, equity stake) and at the right price (non-leveraged), I could support an intervention that would have a chance of working. The problem is that the proposal does not set the right conditions, is too expensive, and is not likely to work. It's got nothing going for it except post-partisanship. And it's the Democrats unwillingness to be partisan and reign in the GOP that got us here. Or did I miss Chris Dodd and Barney Frank jumping up and down every damned day for the last two years screaming about the on-coming financial crisis if we don't do something NOW!

But we won the first round of FISA, too. Then the Dems brought it back. So we need to keep up the pressure.

And since so many of our elected officials seem to care more for corporations than for me, they can quit asking me for money. I'll give to individual Dems, but it will be a very long time before I give to the party again, certainly not while the current yahoos (or is it YHOOs) are in charge. I had sworn off this year, but I'm extending it indefinitely. And I encourage others to do the same. They've made it very clear that they don't want or need us, they have JP Morgan to keep them warm at night.

danps's picture
Submitted by danps on

Your services are needed in Washington.

Seriously, if they let someone with demonstrated accuracy on this stuff take the lead they might be surprised how agreeable us pesky citizens are.

pie's picture
Submitted by pie on

Blount is speaking. Paraphrase: We have to put partisanship aside, respect the Jewish holidays. We were rushing things, and we're going to reach back out to the dems and see if we can be part of the solution - we're not the majority.

Someone else calling it a failure of Speaker Pelosi. Failure to lead, failure to listen, most unproductive year in Congress.

Making the dems look realllllly bad here. Effing repubs pulled the football away again.


gqmartinez's picture
Submitted by gqmartinez on

Isn't that what we're using to bludgeon Obama holdouts into voting for him? Its a shameful tactic when used against what we think is right, isn't? Why reciprocate then?

gqmartinez's picture
Submitted by gqmartinez on

Shouldn't *every* story on this have the vote breakdown and a link to the recorded votes? That way people can see for themselves how such and such Party squashed so and so legislation?

Can any news source be reputable that *doesn't* include these basic facts?

pie's picture
Submitted by pie on

Failure of Pelosi's leadership. The dems tried to hurry this. Must work to pass a bill that will help the country. They're the majority; we're not. The dems have to bring a bill to the table in a bipartisan way.

Looks like the repubs pulled the fottball away again.


Submitted by lambert on

... then the market was going to crash anyhow.

I mean, isn't that the underlying logic here?

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Submitted by lambert on

Who would have predicted et cetera.

Actually, I must credit the good Doctor Black with calling his shot on that one.

Gee, it's almost like they planned to leave the Dems holding the bag, isn't it? Not that Nancy "We are leaders. They are advocates" weren't all to ready to reach for it.

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Submitted by lambert on

is a metaphor that doesn't apply only to the Village.

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

amberglow's picture
Submitted by amberglow on

---- AYES 205 ---

Bishop (GA)
Bishop (NY)
Bono Mack
Boyd (FL)
Brady (PA)
Brady (TX)
Brown (SC)
Brown, Corrine
Camp (MI)
Campbell (CA)
Cole (OK)
Davis (AL)
Davis (CA)
Davis (IL)
Davis, Tom
Edwards (TX)
Frank (MA)
Hall (NY)
Hastings (FL)
Inglis (SC)
Johnson, E. B.
King (NY)
Klein (FL)
Kline (MN)
Larsen (WA)
Larson (CT)
Lewis (CA)
Lewis (KY)
Lofgren, Zoe
Lungren, Daniel E.
Mahoney (FL)
Maloney (NY)
McCarthy (NY)
McCollum (MN)
Meek (FL)
Meeks (NY)
Miller (NC)
Miller, Gary
Miller, George
Moore (KS)
Moore (WI)
Moran (VA)
Murphy (CT)
Murphy, Patrick
Neal (MA)
Peterson (PA)
Price (NC)
Pryce (OH)
Rogers (AL)
Rogers (KY)
Ryan (OH)
Ryan (WI)
Smith (TX)
Smith (WA)
Van Hollen
Walden (OR)
Walsh (NY)
Wasserman Schultz
Weldon (FL)
Wilson (NM)
Wilson (OH)
Wilson (SC)

amberglow's picture
Submitted by amberglow on

Barrett (SC)
Bartlett (MD)
Barton (TX)
Bishop (UT)
Boyda (KS)
Braley (IA)
Broun (GA)
Brown-Waite, Ginny
Burton (IN)
Davis (KY)
Davis, David
Davis, Lincoln
Deal (GA)
Diaz-Balart, L.
Diaz-Balart, M.
Edwards (MD)
English (PA)
Franks (AZ)
Garrett (NJ)
Green, Al
Green, Gene
Hall (TX)
Hastings (WA)
Herseth Sandlin
Jackson (IL)
Jackson-Lee (TX)
Johnson (GA)
Johnson (IL)
Johnson, Sam
Jones (NC)
King (IA)
Kuhl (NY)
Lewis (GA)
McCarthy (CA)
McCaul (TX)
McMorris Rodgers
Miller (FL)
Miller (MI)
Moran (KS)
Murphy, Tim
Peterson (MN)
Price (GA)
Rogers (MI)
Sánchez, Linda T.
Sanchez, Loretta
Scott (GA)
Scott (VA)
Smith (NE)
Smith (NJ)
Thompson (CA)
Thompson (MS)
Udall (CO)
Udall (NM)
Walz (MN)
Welch (VT)
Whitfield (KY)
Wittman (VA)
Young (AK)
Young (FL)

pie's picture
Submitted by pie on

some think there is no crisis. If that's the outcome after a few days, he'll be happy to have been wrong, but he doesn't think that's the case. The administration needs to coordinate with the repubs to get a bill passed.

a little night musing's picture
Submitted by a little night ... on

And I managed to snag a couple of excellent $12 suits for the holiday at Goodwill while I was out, so I'm momentarily happy.

I'm sure our "Democratic" "leadership" will ruin that mood soon enough - but like Barney Frank, I'd be happy to have been wrong.

[Nance? Things have been pretty fkd up here on the street where I live for awhile now. Take the price of food, for example. But thank you for noticing.]

bringiton's picture
Submitted by bringiton on

A persuasive argument is being made that the Executive already has the tools needed to begin to address the current market difficulties. Bush, Cox and Paulson should get about their business and do what they already have the authority to do, while the Congress takes a breath and starts to sort things out and come up with a more measured plan.

Good news, incredibly stupid handing over of a humongous blank check to idiots will apparently not happen.

Bad news, the sausage factory is cranking up and the pursuit of a solution is in danger of be driven by aggregations of narrow interests which may not be in the overall best interests of the American people. Pressure on each individual representative will be required for some long time to come or the “solution” will turn into a pork barrel feast.

goldberry's picture
Submitted by goldberry on

Maybe everyone who calls their Democratic Congresscritter could ask that question.
Over and over again.
I want them to get sick of hearing it to the point whwere they throw in the towel and say, "Fine! Have your Deman Hillary back. Are you happy now?! Just go away and leave me alone."
Then there will be much rejoicing and dancing in the streets and Hillary will be flown from Michigan to take up the thankless task of trying to straighten this mess out.
No good deed going unpunished, the Democrats will despise her even more. But we won't care. Champagne corks will pop and we will party, party, party! At last, a grown up will be in charge.
Come together at The Confluence

Truth Partisan's picture
Submitted by Truth Partisan on

What does this mean?:

"As the U.S. government worked overtime to shore up its financial system, cracks started to show in the world financial sector as two European banks were nationalized over the weekend.

In the biggest European bank bailout since the credit crisis began, three governments jumped in to rescue Belgian-Dutch bank Fortis. The Belgian, Dutch and Luxembourg governments took a 49 percent stake in Fortis with an 11.2 billion euro ($16.4 billion) injection.

Meanwhile, the U.K. nationalized troubled mortgage lender Bradford & Bingley. After weekend talks failed to yield a buyer, the U.K. Treasury said it would take over B&B's 50-billion pound ($90.12 billion) mortgage portfolio and sell its deposits and branches to Spanish bank Santander.

Shares in French bank Dexia tumbled more than 20 percent on a newspaper report that it might launch an emergency capital increase."

Apple shares fell too.

BDBlue's picture
Submitted by BDBlue on

before losing. All of these assets are way overpriced and the banks that own them are going to have to face that and write them down. That's going to hurt their financial status. There are ways to change that, HOLC could help make the mortgages worth something by lowering defaults, but they are never going to be worth the leveraged prices. They never were worth the leveraged prices.

Submitted by lambert on

Nationalization was the Swedish solution, points out Roubini; it worked.

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Submitted by cg.eye on

"To amend the Internal Revenue Code of 1986 to provide earnings assistance and tax relief to members of the uniformed services, volunteer firefighters, and Peace Corps volunteers, and for other purposes"

Again, huh?

BDBlue's picture
Submitted by BDBlue on

Via Stellaaa at Talk Left:

AMY GOODMAN: Congressman Kucinich, can you explain how it is that the Democrats are in charge, yet the Democrats back down on their demand to give bankruptcy judges authority to alter the terms of mortgages for homeowners facing foreclosure, that Democrats also failed in their attempt to steer a portion of any government profits from the package to affordable housing programs?

REP. DENNIS KUCINICH: Well, I mean, those are two of the most glaring deficiencies in this bill. And I would maintain there was never any intention to—you know, well, many members of Congress had the intention of helping people who were in foreclosure. You know, this—Wall Street doesn’t want to do that. Wall Street wants to grab whatever change they can and equity that’s left in these properties. So—

AMY GOODMAN: Right, but the Democrats are in charge of this.

REP. DENNIS KUCINICH: Right. You know, I’ll tell you something that we were told in our caucus. We were told that our presidential candidate, when the negotiations started at the White House, said that he didn’t want this in this bill. Now, that’s what we were told.

AMY GOODMAN: You were told that Barack Obama did not want this in the bill?

REP. DENNIS KUCINICH: That he didn’t want the bankruptcy provisions in the bill. Now, you know, that’s what we were told. And I don’t understand why he would say that, if he did say that. And I think that there is a—the fact that we didn’t put bankruptcy provisions in, that actually we removed any hope for judges to do any loan modifications or any forbearance. There’s no moratorium on mortgage foreclosures in here. So, who’s getting—who’s really getting helped by this bill? This is a bailout, pure and simple, of Wall Street interests who have been involved in speculation.

And I don’t, for the life of me, understand why this is going to do anything to address the underlying problems in the economy, which actually had to do with the recklessness. This is what the president of the Federal Reserve Bank in Dallas said, that—and, you know, I might have the actual quote here. Listen to this quote: he said, “The seizures and convulsions we’ve experienced in the debt and equity markets have been the consequences of a sustained orgy of excess and reckless behavior, not a too tight monetary policy.” This is the Dallas Federal Reserve Bank president, Richard Fisher.

So, you know, we’re getting stampeded here to vote for something that doesn’t help homeowners, that doesn’t do anything about foreclosures, that doesn’t help those people who have been in bankruptcy and are looking for a way out. As a matter of fact, it made sure they can’t get out. So, who’s this for? It’s for speculators. It’s to play a game that provides some temporary help in the market, and, you know, you might see an uptick today if this passes the House. On the other hand, if it doesn’t, we need to be ready to find a way for Wall Street to address its problems without having to tap the increasingly diminishing resources of the federal taxpayers.

Wonder if Dennis regrets sending his folks over to Obama in the Iowa caucuses.

Never been a big Kucinich fan even if I agree with him on a lot of issues, but he speaks for me here:

AMY GOODMAN: It sounds like it was mainly the House Republicans who balked, who revolted on Friday. Yet, you and a number of your colleagues are joining them. Do you believe this will pass today?

REP. DENNIS KUCINICH: It’s going to be a very close vote. And I don’t see this as a partisan issue, by the way. I mean, in a way, the debate that tries to make it a partisan issue is a diversion. This is really whether or not people will side with Main Street in a struggle with Wall Street, because, you know, this is not about left or right. This is about up or down, and it’s about the color green.

And frankly, Wall Street is—has put itself on a trajectory with now we have almost a quadrillion—half a quadrillion dollars of derivatives that are out there, floating out there. People have said that if this is intended to be a fix, it’s a joke, on one hand. On the other hand, who’s paying for it? Why are we rushing this? I don’t—you know, and everything about this, I think, is unacceptable.

And, he supports HOLC! Not that as a political matter Dennis' support is all that important. I do wish he'd have mentioned there's a HOLC bill in the Senate since I'm pretty sure Clinton introduced it.

Submitted by lambert on

As I will keep pointing out over and over again, HOLC not only helps the homeowners, it helps the banks as well, by cleaning up their balance sheets.

It doesn't help the gamblers who bet the rent money on the derivatives, but so fucking what?

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Submitted by jawbone on

He barely uses the words Democrat and Democratic; he doesn't stand up for some pretty clear Democratic principles (FISA, not labeling non-racist Dems as racists), he admires those great Republican ideas and that great Republican guy Reagan.

And, he tells the WH those Dem demands are off the table as far as he's concerned.

Republican Lite? or Republican? or just power hungry?

He reminds me, alas, of the BushBoy so awfully much (full meaning of awful).
Obama had to run as a Dem to get anywhere in his Chicago district, plus he'd put in time as a community organizer to get a feel for the district and to gain cred. So, is he being passive-aggressive bcz he'd really rather be representing some other political philosophy/party? Just useless speculation--partly bcz I don't get a feeling from him as to what he really stands for. Hope, change. Yada, yada.

Submitted by lambert on

In the last debate, zero (0).

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Truth Partisan's picture
Submitted by Truth Partisan on

Someone or sometwo called here to pressure Sen. Susan Collins (who says her constituents won't stand for this bail-out) by contributing to or talking about Rep. Tom Allen who is running against her, I'm guessing because they thought Allen would vote no on this bill.
Allen, who got lots of MoveOn and Obama money, just voted yes.

Truth Partisan's picture
Submitted by Truth Partisan on

Loved his floor appearance!
Great questions.
Kept it short. Did any clips make the news?

bringiton's picture
Submitted by bringiton on

According to an email blast to reporters from McCain senior policy advisor Douglas Holtz-Eakin:

"Barack Obama failed to lead, phoned it in, attacked John McCain, and refused to even say if he supported the final bill. This bill failed because Barack Obama and the Democrats put politics ahead of country."

Voters apparently agree, giving Obama a net +3% approval assessment for his work on the problem while expressing unhappiness with everyone else. The Democratic caucus came in at -11%, while the Republicans are at -13%; Paulson rates -23% and Bush a very deserved -40%.

McCain, after his whirling and spinning and grandstanding, is seen by voters for what he is at -16%, a gap of -19% compared to Obama. Between this flail and the growing disenchantment with Palin, McCain is in danger of becoming a lame-duck for an office he has not yet won.

Obama single-handedly stopped BushCo from stealing $700 Billion dollars, while giving McCain a serious public relations smackown on the most important issue before the electorate; not a bad week's work.

Three cheers for Obama? Two? One, tepidly?

amberglow's picture
Submitted by amberglow on

he threw it all on Pelosi and Reid and let them do it all.

he should have gotten involved--except that he made it clear he wanted it to pass--over and over.

bringiton's picture
Submitted by bringiton on

backed Obama because they could control him?

I think, rather, that they all have been working together pretty closely to insulate Obama as much as possible from any fallout whatever happens. He talked out of both sides of his mouth, hedged every way possible, but in a calm and measured tone. Very presidential-sounding, steady hand at the helm sort of thing, and netted a big plus over the way McCain has handled it.

From a political standpoint, beginning to look like the strategic advantage has shifted to the Democrats on this; if the credit market does immediately tank, they did their best and the fault lies with the Republicans who wouldn't even stand with their leadership. If things don't immediately melt down, McCain looks the fool for his grandstanding while Obama looks like the wise cool head.

The next move is BushCo's and they're pretty good at spinning so we'll see, but right now the Dems - from a pure position of politics - have the upper hand.

None of this is to endorse Democrats on the overall problem or process. Plenty of blame to go around, and I expect to see the Dems carving up the corpse to the advantage of the rich in a way that drives donors into their hands at the expense of the Republicans. A little help might come now for working people, but it will take continued pressure on the Democrats to get that to happen. This is a good time to increase pressure on their necks, not relax.

BDBlue's picture
Submitted by BDBlue on

Instead, Obama said he deserves credit for making sure the proposal includes safeguards for taxpayers. Obama said he is inclined to support the bailout because it includes increased oversight, relief for homeowners facing foreclosure and limits on executive compensation for chief executives of firms that receive government help.

"None of those were in the president's provisions. They are identical to the things I called for the day that (Treasury) Secretary (Henry) Paulson released his package," Obama said. "That I think is an indication of the degree to which when it comes to protecting taxpayers, I was pushing very hard and involved in shaping those provisions."

See here. Of course, what Obama fails to say is that when push came to shove, he was fine with the American public getting shoved and not getting any definitive help on mortgages. (I also think he's taking credit for things he didn't do. To the extent the bill today was 2% less evil than the original Paulson plan had little to do with Obama. It was the work of others. That he may have called for B on Tuesday and then B happened on Wednesday does not actually mean he caused B to happen, he's basically using a logical fallacy of attributing causation to the sequence of events. Besides which, is list of proposals were so vague and nebulous, almost anything could be claimed to fit under them.)

I wish Obama had killed this bill. But he didn't. He helped weaken the Democrats' negotiating position and supported it.

And now he's decrying the inaction in Congress as part of what's wrong with Washington:

“This is a moment of national crisis, and today’s inaction in Congress as well as the angry and hyper-partisan statement released by the McCain campaign are exactly why the American people are disgusted with Washington. Now is the time for Democrats and Republicans to join together and act in a way that prevents an economic catastrophe. Every American should be outraged that an era of greed and irresponsibility on Wall Street and Washington has led us to this point, but now that we are here, the stability of our entire economy depends on us taking immediate action to ease this crisis,” said Obama-Biden campaign spokesman Bill Burton.

That doesn't sound like somebody who wants to kill the bill. It sounds like somebody who wants to salvage it.

He has sucked on this issue pretty much from beginning to end. So far, every time he's had an opportunity to win me over, he's not only not taken it, he's done things that pisses me off further. He's as useless as Pelosi and Reid at this point.

bringiton's picture
Submitted by bringiton on

Obama has tried to straddle this issue and how ever it sorts he will be able to point to one statement or another to cover himself. This is - for a political junkie - just fascinating, don't you think?

A game of hot potato with the Treasury, passing the bag around trying to not get burned but position yourself to pick out as much money as possible for your friends and allies.

Not a lot of worry on anyone's part about thee and me, but there seldom is. If there is to be any benefit for Main Street the pressure for it will have to come through badgering Congress - it has actually had an effect, and I credit citizen activism completely for bringing this to a pause.

The net for Obama - in running for election, his number one goal - has been a big plus; I can be unhappy about how it has played out and still admire the political moves in what remains a very dicey environment.

If, as it appears, my choice is between a smart, calm, deliberate and measured conservative and a volatile, erratic, ill-informed and grandstanding conservative, I'm going to go for the calm one. I am such a coward when it comes to nuclear war.

BDBlue's picture
Submitted by BDBlue on

and that's how I would describe Obama and the Democrats. I do not think this has benefitted them politically because they're brilliant politicians. Basically the House GOP saved their asses by killing this bill. If it had passed, I don't know if the Dems would've escaped the wrath of the people and that includes Obama. Lucky for the Dems the House GOP hates Bush and McCain and did what good politicians do, which is watch out for their own electoral interests and so they scuttled it. If they hadn't, then we'd be talking about a very different situation.

But for now it does appear to have worked in the Dems favor.

I say for now because I still think there's a good chance a bill gets passed and to get the House GOP on board it will be worse than this one.

So I agree with your statement upthread that now is not the time to let up pressure.

And I'd take more joy in watching the politics unfold if I didn't pretty much hate every major player with the heat of a thousand suns at this point.

Truth Partisan's picture
Submitted by Truth Partisan on

--nice stats!--but there is this:"U.S. presidential candidate Barack Obama said on Monday he believed Congress would ultimately pass a proposed $700 billion financial bailout deal, despite its initial rejection by the House of Representatives....He urged Americans and the financial markets to remain calm after the bailout deal failed, provoking a drop of about 5 percent or more in many U.S. stock market averages."

bringiton's picture
Submitted by bringiton on

Obama is trying to get on both sides of the issue, with enough spread to cover himself how ever things turn out. The immediate deep-side danger is that BushCo lets the economy go into free-fall, so Obama has to be for the bailout - if it all goes to hell he did his best, blame the Republicans in congress. If, as it appears, BushCo will not cut off their nose to spite their face, then he can point to statemenst where he has called for more safeguards and claim credit for slowing it all down. Politically, win-win.

He's going to keep pushing for doing something, as are the Dems in general, because it serves their interests to be seen as active and brings big donor money to their side of the table. The more money they move through Comgress, the more they can parcel out to supporters and the more influence they gain. (Please; I'm not supporting this kind of calculation, just explaining what I see happening.)

There appears to be some interesting meat on the bones of this corpse; who voted yea, who nay. Very complex individual politics, and a very back-handed bit of leadership vote counting as well. The aim of Pelosi and Reid seems to be to make sure that whatever happens, if there is a downside it gets blamed on the Republicans.

BDBlue's picture
Submitted by BDBlue on

and by "they", I mean the Dem and GOP leadership.

And I know you aren't endorsing any of this mess, BIO. You seem as disgusted by it as the rest of us.

The problem is that there's a real problem here. The banking system is in deep trouble. So while the Village tries to either hide it through the bailout or blame it on the other side, things continue to deteriorate.

Via Arthur Silber, Mike Whitney describes what the true problem is - the banks and possibly even the Fed are running out of money to cover this mess. I don't know if his analysis is right or not, but I'd believe him over the Village at this point.

But they will do nothing except try to escape accountability and because of it a lot more people will be hurt a lot worse than necessary.

The only good news in all of this is that people really do seem just about fed up with the lot of them. It's about time.

This systemic bullshit - in the financial system, in the media, in politics - cannot be sustained forever. And that's change I can believe in. These folks are not going to be able to stop the collapse or contain the damage to the country, but also to their system. Every day I see them in action, I become even more certain of that.

Their world is collapsing around them. This bailout was simply a last gasp to try to prop it up. I only wish so many regular folks weren't going to be hurt along with the Village.

(Don't get me wrong, the rich will still make money, they always do, but I do think we're nearing a point beyond which the great lies of the last thirty years can no longer be sustained. What will replace it, better or worse, I don't know, but Obama is right about one thing - change is coming. It's just not going to be the change he thinks it's going to be.)

BDBlue's picture
Submitted by BDBlue on

check out the Whitney article, as much as $5 trillion could be needed. That was the purpose of the Paulson plan to set up a funnel to just keep moving money from taxpayer to bank.

It's also why the leadership of either party hasn't really gotten serious about HOLC or other things that need to be done - it's still going to mean a lot of failed banks and a lot of losses. There is no bailout for this mess. We're strictly into pain management and negotiating over who is going to feel the most pain. Predictably, the Village doesn't think it should be them or their big donors.

Submitted by lambert on

You bail out the real economy first -- people with homes who can make payments, and banks with real balance sheets that have mortgates on those homes.

Then you might bail out a few of the gamblers--the derivatives guys. But they should come later, and I think all the fake money floating around -- more money than there is in the world (and $700 billion is a fleabite) is their doing.

Actual economists feel free to correct me.

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

bringiton's picture
Submitted by bringiton on

On the other hand, it could be viewed as a step forward that this time we've been handed a fake solution for a real problem; all the ones previous from BushCo have been fake solutions for fake problems. Baby steps....

I could be wrong, this one is very messy, but what I anticipate now from reading the various statements and listening to speeches on the House floor this PM is that the "solution" will get broken down into chunks, the easier to trick the public into swallowing the whole.

Maybe $250 billion up front, in the next week, maybe in a couple of separate packages with great-sounding names like Save America or Preserve Main Street to make them slide down smoothly - so much less than the initial request, surely a great legislative victory. The rest of the term will be spent on the election, which is where everyone wants to be, and then next year they'll slice and dice the remaining trillions into a hundred different bills that spread the wealth around to as many fat cat pocketbooks as possible.

Thanks for recognizing that when I talk about process it doesn't mean I agree; just trying to gain an understanding of what is happening, not advocate for it. Perhaps I'm getting better at explaining myself; or perhaps this time like Obama, I just got lucky.

BDB: Obama is right about one thing - change is coming. It’s just not going to be the change he thinks it’s going to be
I agree; I'm counting on that. When it comes, I think we will be better off with him in office than McCain. Obama will go with the flow, CYA all the way, while McCain will just dig in his heels and nuke Iran or something else stupidly beside the point. He didn't crash all those jets by being a careful pilot.

BDBlue's picture
Submitted by BDBlue on

Via Calculated Risk, Paulson is going to work with Congress to try to get the plan passed. That's right, the same plan (because vampires are immortal). Only this time they're apparently starting in the Senate and trying to pressure the House because they think they have the votes in the Senate.

To recap, our "leaders" agreed to the bailout plan. The American public hated it. They complained to their House members, every one of which is up for re-election. Enough members of both parties balked and it failed. So whaddaya gonna do? Revise it to make it more acceptable to the American public? Fuck no. Put forth the same piece of shit in the Senate where a lot of members are not up for re-election this time around and are more insulated from the people.

Submitted by lambert on

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Valhalla's picture
Submitted by Valhalla on

Short term = the next hour, maybe two.

The bailout was rejected mostly by people in close races or whose constituents seemed to be making 'credible threats' (ha ha remember those?) to throw them out. I take heart from the fact that some politicians listened to the voters -- even if only for their own self-preservation. Because I really thought that voting was dead, after 8 years of Bush and the shining integrity the Democrats demonstrated this year.

Not that the MSM seems very interested in the intense public opposition to the bailout, or discussing the fact that this is was a stunning failure to lead on everyone's part -- Bush, Treasury, Republicans and Democrats altogether monumentally failed. WaPo article didn't even mention public opposition and the NYT stuck a short para. on page 2 of their article -- they're much more interested in the nyah nyah catfight between Ds and Rs. Because why would discussing the utter disgust of most Americans (and as far as I can tell, most economists) for the bill's provisions help shape a better, more productive bill?

Yes, I know my happiness at this moment (and possibly the next 60 or even 120) is quite possibly just celebration of a Pyrrhic victory. But triumphs for democracy have been so thin on the ground for the past 8 years, I'll take this one, for a bit.

Btw, has anyone seen an explanation or discussion or even a weak-ass crap defense of why HOLC wouldn't be a good solution?

Submitted by lambert on

Valahalla asks:

Has anyone seen an explanation or discussion or even a weak-ass crap defense of why HOLC wouldn’t be a good solution?

No, of course not. And I try to keep track.

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

gqmartinez's picture
Submitted by gqmartinez on

Both are Senators and supposed to be leading their party should they steal, er, "win" the presidency. Additionally, they will both be stuck dealing with the after affects of this bailout. That they are *both* showing apparent disinterest in the details of this is alarming. That tells me a lot about how their presidency will be run: as clueless as Bush's.

Sorry, my McCain=apocalypse brothers and sisters, Obama's seeming disinterest in the nitty-gritty doesn't calm my fears that Obama wouldn't lead to an apocalypse as well. The only difference is that progressives will be cheering and justifying the oncoming apocalypse if Obama ushers it in.

Submitted by lambert on

Doing... Well, you can imagine....

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

Submitted by lambert on

... and I can well imagine why one, or indeed several, might be needed, especially while the situation is still so fluid, but what on earth is a panky?

[ ] Very tepidly voting for Obama [ ] ?????. [ ] Any mullah-sucking billionaire-teabagging torture-loving pus-encrusted spawn of Cthulhu, bless his (R) heart.

gqmartinez's picture
Submitted by gqmartinez on

Would she be as quiet if she were the nominee? I'm sure she has plenty of ideas and comments, why aren't we hearing more from her? Is she intentionally staying in the background or is she being pressured to? If the Kucinich story is true then the fix is probably already in on this. I guess its fine since our wiser and better overlords know best anyway.

chicago dyke's picture
Submitted by chicago dyke on

fuck me, that's two more i have to cross off the list. dammit.

thanks for all the useful links, kids. be proud of yourselves. this little community has Done Its Part magnificently in this particular crisis. good job.

BDBlue's picture
Submitted by BDBlue on

to thank him for voting no and urge him to continue to oppose any bailout and to consider supporting HOLC. I'm happy to see him show a little independence. Rumor has it that he wants to run for Feinstein's seat. Perhaps this is a sign he's decided to try to make a name for himself. If that's the case, then this was a good start. (Although I still haven't forgotten FISA.)

Valhalla's picture
Submitted by Valhalla on

Do you mean in general, or specifically on the bailout vote?

She was all over the teebee last week advocating for HOLC. On the bailout bill particularly, she was guardedly in favor as of a week ago, but believed "there needs to be accountability and oversight and some authority for mortgage modification or we're not going to get to the root of what is going on..."

Fairly good summary of her comments on Fox Business news. The whole video here. There's a little bit at the end that's cute.

But I can't find that she was interviewed or made a statement today specifically on the failure of the bailout bill. Hopefully she's raising hell behind the scenes.

pie's picture
Submitted by pie on

SINGAPORE -- Asian shares were sinking Tuesday with investors dumping riskier assets across the board after the U.S. House of Representatives shocked markets by voting down a proposed $700 billion bailout package for the financial sector.

Japan's Nikkei 225 dropped 5% with a slew of banking, auto and exporter stocks still ask-only.

Korea's Kospi Composite had fallen 4.8%, while Australia's S&P/ASX 200 was down 4.3%.

New Zealand's NZX-50 was down 4.2%. AMN Amro Craigs investment adviser Nigel Scott said the fall should spur the Reserve Bank of New Zealand to institute an inter-meeting rate cut; "it's a huge probability," he said.

Several markets in Asia will be closed for holidays Wednesday, which may prompt some wholesale dumping Tuesday by those unwilling to hold positions over the break; Singapore and Hong Kong are among those to be shut Wednesday.

chicago dyke's picture
Submitted by chicago dyke on

thanks for the asia update. if i were less tired i'd be keeping up with that just now. and darn, it's good to see you again. let's think seriously about an MI gathering again soon, yo? i'm willing to host, and cook.

Sarah's picture
Submitted by Sarah on

From the dept. of even a blind hog finds an acorn once in awhile, the most reliable Bush crony in the House did the right thing.

Son of a bitch.

This is almost worth watching the Redskins win last night.

We can admit that we're killers ... but we're not going to kill today. That's all it takes! Knowing that we're not going to kill today! ~ Captain James T. Kirk, Stardate 3193.0

Zadig's picture
Submitted by Zadig on

I agree with the analysis of bringiton and bdblue, except for the theory regarding Pelosi & Reid controlling BO.
However, as much as I don't like BO, I think it is a mistake to castigate him as severely as some are inclined. Please, if you continue this course, I fear a McLame victory come November. I appreciate and agree with (to a large extent) the ravings of Mr. Silber and others, but I must play the pragmatist here and say that, CLEARLY, the Obama administration would be superior to a McLame administration. Fuck that old scumbag. He's clearly over his head; he's been on one truly awesome head trip since the 1950s.

"Beer is living proof that God loves us and wants us to be happy." Benjamin Franklin

P.S. Amberglow and elixir, your comments are interesting but generally tiresome. elixir, just what job do you love so much? Have you ever thought of changing that?

pie's picture
Submitted by pie on

I just saw your post.

I'd love to get together, although post-election might be better. :)

I've enjoyed your gardening posts and pics. Beautiful stuff. Nice job!!