Why And What’s Next? - On the Economic Stablization

Gary Bauer, Campaign for Working Families: What is the explanation for both solidly liberal Democrats and solidly conservative Republicans voting no on yesterday’s economic rescue plan? This is an important distinction because it tells us everything we need to know about the difference between the two parties. Liberal Democrats voted against it because it did not include billions for leftwing groups, union giveaways, and more money for risky mortgages to low income households. At the same time, many conservatives voted no because they did not like the massive government intervention in the market. They feared that there were not enough taxpayer protections, even though similar efforts in the past have actually worked out well and many believe the government will recoup most, if not all, of the money invested.

You can be proud of Republicans for improving the bill, but here’s the problem we have now. There is no doubt about which side is being blamed for this crisis. The leftwing media and its political allies are blaming Republican policies and the free market. Since this crisis exploded on our TV screens, Barack Obama has taken commanding leads in the polls. The latest Rasmussen daily tracking poll has Obama up six points over McCain – 51%-to-45%. Virtually all the major media outlets are spinning yesterday’s vote as a defeat for McCain.

I know where the blame lies for the subprime mortgage meltdown. (see transcript of a Fox News report.) I know the liberal Democrats, encouraged by leftwing agitators like ACORN, created that problem. ( more on ACORN: op-ed by the New York Post.) But the media are not going to explain that. The same liberal Democrats who created this problem repeatedly thwarted GOP attempts over the past decade to fix it, and they once again control Capitol Hill. We cannot control the media and we cannot control the debate in Congress.

I know some of you are happy this bill was voted down, but let me explain what I think you may be missing “behind the scenes” in Washington. The bill that was voted down was supported by a lot of conservative institutions – from the Heritage Foundation to top executives of trade associations representing the nation’s realtors, the Chamber of Commerce, manufacturers, small businesses, etc. Support for this bill went across the ideological spectrum from a host of folks and industries who are well aware of the dangers of a potential credit freeze. Many people believe we are at risk of a severe recession, possibly even another depression. And good people who have done nothing wrong will be hurt terribly by the fallout if our economy collapses.

The Bush Administration is fearful, with good cause, of a total economic failure. As the president reiterated this morning, “As much as we might wish the situation were different, our country is not facing a choice between government action and the smooth functioning of the free market. We’re facing a choice between action and the real prospect of economic hardship for millions of Americans.” The president is demanding a new bill, and there are numerous warnings that “the Democrats [may] do something on their own with all the stuff they wanted.”

There is a real danger now that the next plan will be far worse because the Democrats have the votes to force whatever they want through the Congress. Republicans did not defeat this bill – the 95 liberal Democrats who voted no defeated this bill! Five Democrat committee chairmen voted no. Half of the Congressional Black Caucus voted no. A majority of the Hispanic Caucus voted no. These liberal Democrats voted no because in their view the bill was too conservative! But, the bill just defeated may have been the best thing we could have gotten out of this Congress. Having succeeded in killing a bill she didn’t like, Nancy Pelosi is now poised to write and pass her own bill, without input or votes from the House GOP. I guarantee you there will be nothing in that legislation to cheer about.

President Bush, Senator McCain and Hill Republicans need to present a bold plan of their own and force Congress to consider it. The plan should suspend the “mark to market rule,” tighten regulations on manipulative short selling, slash corporate and investment taxes and seriously curtail spending. Let’s have a serious debate about economic policy in this country and then let the American people decide the course they want to take in 35 days.

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Tags: bailout, Democrats, economic stablization, Gary Bauer, Nancy Pelosi, Republicans, US Congress To share or post to your site, click on "Post Link". Please mention / link to the ARRA News Service. Thanks!