Bastardization of the word Bipartisan
Bipartisan: bi·par·ti·san; adjective; of, relating to, or involving members of two parties ; specifically : marked by or involving cooperation, agreement, and compromise between two major political parties.
Irrational exhuberance has played out daily this week with a 700 point drop, a ~500 point rise, and a flatline (so far) today in the Dow. Wall Street appears to be holding its’ collective breath waiting for the bailout (or the rescue plan, or the poor-decision-making-assistance-plan, or whatever people are calling it). The vote failed in Congress thanks to folks like a bazillion economics faculty from all around the country who delivered this letter to Congress:
To the Speaker of the House of Representatives and the President pro tempore of the Senate:
As economists, we want to express to Congress our great concern for the plan proposed by Treasury Secretary Paulson to deal with the financial crisis. We are well aware of the difficulty of the current financial situation and we agree with the need for bold action to ensure that the financial system continues to function. We see three fatal pitfalls in the currently proposed plan:
1) Its fairness. The plan is a subsidy to investors at taxpayers’ expense. Investors who took risks to earn profits must also bear the losses. Not every business failure carries systemic risk. The government can ensure a well-functioning financial industry, able to make new loans to creditworthy borrowers, without bailing out particular investors and institutions whose choices proved unwise.
2) Its ambiguity. Neither the mission of the new agency nor its oversight are clear. If taxpayers are to buy illiquid and opaque assets from troubled sellers, the terms, occasions, and methods of such purchases must be crystal clear ahead of time and carefully monitored afterwards.
3) Its long-term effects. If the plan is enacted, its effects will be with us for a generation. For all their recent troubles, America’s dynamic and innovative private capital markets have brought the nation unparalleled prosperity. Fundamentally weakening those markets in order to calm short-run disruptions is desperately short-sighted.
For these reasons we ask Congress not to rush, to hold appropriate hearings, and to carefully consider the right course of action, and to wisely determine the future of the financial industry and the U.S. economy for years to come.
Also helping in the effort was the website www.stopthehousingbailout.com which had this hilarious picture on the front page of their website:
In the name of keeping the facts straight, here’s a list of which way the votes actually went, straightening out the assertion by the Democrats that the Republicans submarined the bill. The hard numbers show 2/3rd’s of Republicans voting no with 40% of Democrats doing the same.
One thing you can be damn sure of is none of these people are capable of fixing the problems our economy is facing, or if they are capable, our political system will prevent them from doing so.
Fault lies on both sides in Washington but since the media broadly represents only the left, I feel compelled to point out two things: first, Democrats blocked Bush and the Republicans from trying to reform Fannie and Freddie five years ago, an action that at the very least could have softened what we’re going through right now.
Second, Chris Dodd and Barack Obama stand as the largest recipients of PAC money from Fannie Mae and Freddie Mac prior to their insolvency- $165,400 for Dodd and $126,349 for Obama. Just so everyone is clear on the timelines- Dodd and the democrats block reform, take in large sums of money, watch the companies collapse, and then blame Bush and McCain for the problem. That’s straight politics homey, gangster style.
In the wake of the house voting down the “rescue” bill, politicians continued to claim to be seeking a bipartisan solution. Yet, as the votes were being cast on the house floor, Nancy Pelosi delivered a toxic “who’s to blame” speech poisoning the vote and showing where real motives lay.
In order to help you understand the elements around this issue and to help you be a more informed voter (Conservative), here are several useful links. First, is the analysis of the original bill as provided by the Senate banking committee. Second is a historical lesson on the S&L mess and what’s led up to where we are in banking. Third is the Wikipedia entry on “Mark to Market” which many people are blaming in part for this problem. Finally, an article on mark to market at one of my new favorite websites (nakedcapitalist.com).
You’re welcome.
Posted in Decaying the American Brain, Current Affairs | 4 Comments »
