Tuesday, September 30, 2008

the financial bill

I'm not a financial expert--and I wouldn't ordinarily blog on Rosh Hashana--but before Republicans are blamed for the collapse of the economy let me offer the following comments:

1. The bailout bill was defeated by a bipartisan vote. More Republicans voted against it, but the principal division was people who were nervous about their seats and people who weren't. More Republicans are nervous (with reason) and accordingly voted against it.

2. The bill is unpopular for good reasons. In a democracy it is understandably difficult to pass legislation which benefits, or appears to benefit, wealthy borrowers without doing anything much to help poorer borrowers in an equivalent condition. That the bill was flawed even in the eyes of its supporters (e.g., Paul Krugman) makes the case all the more difficult. If legislation is in fact as necessary as argued, it should be the best legislation available, and a better job should be done explaining it.

3. The whole notion that conservative economics are responsible for the real estate bubble is ridiculous. Both parties participated enthusiastically in the rush to deregulate and received large campaign contributions from the parties that benefited. Obama is if anything rather closer to the Wall Street crowd than McCain or his supporters, far more so than the Palin wing of the party which--whatever its faults--has never been accused of financial sophistication.

It is also fascinating to see McCain ridiculed for suspending his campaign while at the same time claiming that this is the largest financial crisis in 80 years. No doubt his interventions have been ham-handed, and Obama's coolness under pressure has presented a better political image. But image and coolness show few signs of resolving the crisis. Keith Olbermann quoted some baseball wag last night, to the effect that this is no time for reasoned discussion, the situation calls for panic. Doesn't this apply to his candidate, as well?


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