Despite their shit-eating grins, Democratic leaders nearly got rolled today, but a mixture of luck and bad faith from Republicans saved them. How do you know that the Wall Street types were trying to steal from us, other than the fact that they said that the refusal to hand over money was akin to a terrorist act?
Well, Treasury officials had a secret conference call with Wall Street executives. Unfortunately for them, some bloggers were on the call.
The 'Treasury boys' on the call made it clear that "the tranching is a mere formality, and the Treasury boys as much as said so. They could take the $700 billion max as soon as the bill has passed." That was always obvious.
And they admitted that "the exec comp provisions sound like a joke, They DO NOT affect existing contracts, they affect only contracts entered into during the two years of the authority of this program and then affect only golden parachutes." Both of these provisions were 'concessions' sought by Democrats. Of course, no one could have predicted this bill's 'concessions' to Democrats were farcical. No one at all.
What's perplexing is why the Democratic activist class is not as outraged as the country about this measure, and I include us on the internet. It's worth noting that the blogosphere is very much split on this measure. Here's Nate Silver:
Having said all of the above, the schadenfreude of certain liberals on this issue is absolutely obnoxious. A lot of people are going to be hurt by this, and not just those in the investor class. I tend to see this more as a failure of our democracy than a reaffirmation of it. The congressmen who are retiring this year -- and who therefore can perhaps be described as the most neutral arbiters of the public good -- voted overwhelmingly for this measure.
Why would retiring Congressmen who do not have to face the voters but might have to face Wall Street recruiters be neutral arbiters of the public good? Why is it bad that candidates in tight elections voted against this bill for political reasons? Isn't that how we decide stuff? I've had the TV on all day and it is a pervasive message that partisanship sunk this and is therefore the root of all evil. I just don't get this attitude. This bill was unpopular and hated because the people proposing it do not have the faith of the public to write honest laws or carry them out. That is the problem, not partisanship or an excess of democracy. The belief that democratic pressures augur against the public interest is widespread, from Silver to this recommended diary by dansac.
This is a political crisis, which is why the public is angrily rejecting laws based on Republican demands for a bailout and Democratic concessions which everyone involved at the time knew were a total farce.
UPDATE: Here's Pete Stark, progressive caucus member.
"We now face a choice. President Bush tells us we must inject $700 billion into this market to avoid a total meltdown. He and Secretary Paulson say it is the only answer. Many economists – who don't have a financial stake in Wall Street or an 8-year record of bad decisions – tell us it isn't the only choice. An option would be to assist homeowners with their mortgage payments. By making sure these mortgages remain viable, the market should stabilize.
"The bill before us today is basically the same three-page Wall Street give away first put forth by President Bush. The fig leaf adjustments are not enough to outweigh the fact that no one knows if this bill is what's needed. I'm not willing to make a $700 billion gamble that President Bush is right after 8 years of seeing all that he's done wrong."
Stark always puts the public interest first. That's what being progressive means.