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Saying No to Another Blank Check

By John Fox · October 1st, 2008 · Editorial

I’m the kind of person who wants to know everything about everything. It’s difficult for me to admit privately, much less publicly, when I can’t get my arms around an important topic.

But the current financial crisis is kicking my ass.

What exactly is going on here? Why are the country’s (and soon to be the world’s) financial operations on the brink of collapsing? Why does the federal government need to pump $700 billion of taxpayer money into “the system?” What happens if we don’t?

I’ve tried to educate myself, and I think I have an OK framework of the underlying problems, but I’d be lying if I said I understand it. In essence, the federal government hopes to bail out Wall Street by buying up bad mortgage loans and the investment schemes created to finance them, enabling money to start flowing again throughout “the system.”

The proposed bailout, however, is dead for now.

The House of Representatives defeated the President Bush’s plan on Sept. 29, and the U.S. stock market tanked.

Several truths have become self-evident in this crisis period, starting with the appalling lack of leadership in D.C. No one cares what Bush thinks about anything, even Congressional members from his own party, who likely blame his horrible reign for dooming their own reelection prospects.

Bush, his Treasury secretary (former Wall Street guru Henry Paulson) and his Federal Reserve chairman (Ben Bernanke) foisted a pass-this-or-we-all-die plan on Congress and the American people, and a lot of people aren’t buying it. Two-thirds of the House Republicans rejected the plan, even though the House GOP leadership (from West Chester’s own John Boehner on down) backed it.

The Democrats have failed to come up with any kind of substantive alternative plan. They took Bush, Paulson and Bernanke at their word and jumped on the bandwagon — and they too got burned in the House vote, as about 40 percent of Democrats rejected the plan.

John McCain suspended his campaign to get involved, yet the campaign didn’t really stop and he didn’t deliver the conservative votes in the House. Barack Obama sits on his hands.

I applaud the House vote. We’ve seen the Bush administration use scare tactics before to march this country to war in Iraq, and Congress authorized a blank check that’s come back to haunt us all. House members had the guts finally to say “No” to Bush. Now comes the really hard part: What’s Plan B? In this so-called battle between Wall Street and Main Street, the little guys actually won this skirmish, shouting loud enough for the House to hear.

One of two things happens from here: Bush, Boehner, Nancy Pelosi and others bring so much pressure to bear on House members that the dissenters crack and approve the plan, or the dissenters come up with a better plan. Better plans are floating around, waiting for a leader to lead. We need one to emerge.

CONTACT JOHN FOX: jfox@citybeat.com



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