Wednesday, October 1, 2008

Try, Try Again

The Senate will take up the bailout vote today.

Prodded by a wave of angry calls from constituents, congressional leaders dialed back partisan bickering over the $700 billion Wall Street rescue plan yesterday and advanced modest changes to the legislation in an effort to win over House Republican holdouts.

Leaders of the Senate, where most members have indicated support for the plan, said they would seek a vote on a revised rescue package tonight that would include a one-year increase in Federal Deposit Insurance Corp. caps for bank and credit union accounts, extensions of numerous business tax breaks that have expired and a fix to the alternative minimum tax for individual taxpayers.

The FDIC and tax provisions could make the bill more appealing to House Republicans, but they could also prove unpalatable to a coalition of conservative Democrats who have long opposed the tax changes. The Senate banking committee’s chairman, Christopher J. Dodd (D-Conn.), who helped negotiate the revised package, expressed confidence that the revisions would yield a majority of House votes.


There was a widespread sense on Capitol Hill that Monday’s vote had snapped the public to attention about the potential repercussions of Congress’s failure to act. Last week, House and Senate offices were bombarded with calls from opponents who viewed the bill as a Wall Street boondoggle. That call pattern shifted sharply after Monday’s vote, aides to lawmakers in both parties said. “It’s completely in the other direction now,” said Michael Steel, a spokesman for House Minority Leader John A. Boehner (R-Ohio).

Senate Majority Leader Harry M. Reid (D-Nev.) called the Senate’s revised legislation “the best thing to move forward.” Reid was joined on the floor by Senate Minority Leader Mitch McConnell (R-Ky.), who said the plan was “one of the finer moments in the Senate.”

Let’s also hope that the Senate learned something from their House counterparts and go forward when they are sure they have the votes.

Meanwhile, Ezra Klein poses a question:

It’s easy enough to imagine a society running atop a stable economy even when it has an unhealthy politics. And it’s simple enough to see how an unstable economy can be calmed through concerted action by an effective political structure. But an economy in chaos and a political system in paralysis? What happens then?

You end up with an electorate that grasps at straws and you end up with leaders who exploit their fears. You don’t have to look too far back in history to see where a failing economy and a weak political system have lead to horrors: Germany in the 1920’s comes to mind, as does a lot of countries in post-colonial Africa and Asia. They fell prey to extreme political movements of the left or the right and were exploited by opportunistic despots like Hitler and Mugabe who won the voters over with promises of economic prosperity and a renewed sense of nationalism and self-worth…if only they were granted vast and unchallengeable power. It’s amazing how easily it worked when both economic and political power are in peril.

They say it can’t happen here. Yes, it can.