I never thought I would write these words: Thank you, Republicans.
The House defeated the proposed economic rescue package today, a bill that would have authorized unprecedented government intervention in the marketplace. While I agree that the U.S. needs a comprehensive plan to avert an economic disaster, common sense tells us that attempting to redesign U.S. capitalism in a little over a week--during an election season, no less--is absolute lunacy.
While the Democrats delivered their promised votes in favor of the bill, stalwart Republicans from across the country actually listened to their constituents, and defeated the bill. We are in uncharted territory in the financial markets, but rest assured, Democracy, at least, is still breathing.
The following choice statements from the House debate are courtesy of WWJ News Radio, Detroit.
Rep. Mel Watt, D-N.C., said, "I wish we had a president that had enough communication skills and enough credibility with the American people to convince them there is a real problem. Unfortunately that burden hasn’t been carried sufficiently by the administration. But I'm convinced that the odds are bad enough that if we don’t do something today we will regret it for a long, long time."
Standing in opposition to the bill, Rep. Thaddeus McCotter, R-Mich., said the government intrusion into the free market marked would, like the Bolshevik slogan of "Peace, Land, and Bread," promise short-term prosperity at the sacrifice of liberty. "The people on Main Street have said they prefer their freedom, and I stand with them," McCotter said.
Likewise, Rep. Lynn Woolsey, D-Calif., said the bill failed to address the root causes of the financial crisis by neglecting to provide, among other factors, foreclosure relief. "Stability should come from the bottom up," she said.
"Why isn’t Wall Street paying for the mess they created?" Woolsey asked, suggesting a surcharge on stock trades. "We can raise $150 billion a year from those who caused this mess and profited from it."
She also questioned the wisdom of giving discretion over the use of hundreds of billions of taxpayer dollars to the outgoing administration.
"Why are we willing to even make available $700 billion to this administration? Bush and Paulson have been wrong from the start on just about everything. If you think they will be responsible with this money, think again."
"Like the Iraq War and the Patriot Act, this bill is fueled by fear and hinges on haste," said Rep. Lloyd Doggett, D-Tex., who noted the bill does not require Wall Street to pay even a dime in recompense. "All of us want to avoid further economic deterioration, but action or inaction today is a false choice.
"The vultures have now come home to roost," Doggett said.
Meanwhile, his fellow Texan, Republican John Culberson, blasted the legal protections impinging oversight of the Treasury Secretary's discretionary use of the funds. He suggested other means (including reducing the capital gains tax to zero) would work better.
Rep. Brad Sherman, D-Calif., who is opposed, said, "Just because this bill is unpopular doesn’t mean we have to pass it immediately."
Rep. Carolyn Maloney, D-N.Y., who called the current crisis "the financial equivalent of a heart attack," said the bill is not popular but is necessary.
"I know we're tempted to see this as just another train wreck of the Bush administration," said Rep. Chaka Fattah, D-Penn., who said the crisis actually threatens constituents' 401(k)s, pension funds, the ability to borrow and establish businesses, and the security of community banks.
Rep. Ted Poe, R-Tex., decried the bailout of "Wall Street moneygrabbers," and wondered why it is that, the bigger the business, the more government feels it should "swoop in and save them," whereas mom-and-pop business that make bad financial decisions just fail.
"They expect Joe Six-Pack to buck it up and reward this nonsense," he said. "It's sad time to be an American taxpayer.
"Wall Street should pay for Wall Street's mistakes," said Rep. Judy Biggert, R-Ill., who said she was reluctantly opposed to the bill.
Rep. Peter DeFazio, D-Ore. denounced the "trickle-down" economics behind the bill, and called the mammoth funds involved "sort of like the financial surge strategy, and just like the surge going into Iraq we know it's not sustainable."
He also said the golden parachutes for executives were merely switched for "camouflaged parachutes."
"If we vote for this bill it is the end of the Reagan era," said Rep. Darrell Issa, R-Calif.
Rep. Paul Broun, R-Ga., who called the bill a gift to Secretary Paulson's "friends," said it was merely a stop-gap measure that did nothing to prevent further economic catastrophe.
"This is a huge cow patty with a piece of marshmallow stuck in the middle of it and I'm not going to eat that cow patty."
"I have no matching metaphor," Rep. Barney Frank responded.
Rep. Maxine Waters D-Calif. said she was voting for the bill, but called for the prosecution of financial titans who violate the law and ignore their fiduciary responsibility. "We will tighten the screws on Wall Street."
Rep. John Tanner, D-Tenn. said, "This is no longer about bailing out anyone; it is about trying to put together a plan that will do less harm than we would do otherwise by our inaction to every American's financial security."
Rep, Earl Blumenauer, D-Ore. said, "We cannot continue to bail out with borrowed money."
Rep. Louie Gohmert, R-Tex. was angered that management of the assets purchased from failing banks would be outsourced "to the people who caused this problem.
"Let’s save America from Congress."
Many complained of the speed of the process, and the fact that hearings and committee deliberations were not held on the legislation. "We need to take out time on this," said Rep. Carolyn Kilpatrick, D-Mich., who noted that the Senate will not be taking up the bill until later this week. "There is a better process. I hope that we can slow down this train. I urge a 'no' vote."
Rep. Paul Ryan, R-Wis., said he was offended when Paulson offered a three-page proposal asking for a bank account with $700 billion in it for him. "So what happened since then, we added 107 pages of taxpayer protection to this bill.
"This bill offends my principles but I'm going to vote for it in order to preserve my principles, to preserve our financial system." He urged others to vote for it, even though, "We're one month away from an election &30151; we're all worried about losing out jobs."
"The White House brought this to a crescendo, to a crisis, so that all eyes of the world are on Congress. It’s a heavy load to bear. We have to deal with this panic, we need to deal with this fear … and if we fail to do the right thing, heaven help us. If we fail to pass this, I fear the worst is yet to come."
Rep. Ginny Brown-Waite, R-Fla., said taxpayers had a gun pointed to their heads. "This isn’t legislation, this is extortion.
"Do you like ten trillion dollars of debt? With one stroke of the pen Congress will have extended that an additional trillion.
"Make no mistake: a vote for this bailout is a vote to ratify business as usual in Washington."
Like many speaking today, Rep. Steven LaTourette, R-Ohio, praised Rep. Frank (the key House member in demanding alterations to the administration proposal) for his "noble work in being handed a pile of garbage and making it better."
But LaTourette said the taxpayer should pay for it. He also called for the repatriation of offshore funds.
House Speaker Nancy Pelosi said the "staggering" cost of the $700 billion package was "only a part of the cost of the failed Bush economic policies to our country.
"They claim to be free market advocates when it is an 'anything goes' mentality," she said, saying the administration's budget recklessness turned around the budget surpluses of the Clinton administration, and if a crisis got so bad, "you will have a golden parachute and the taxpayer will bail you out.
"Those days are over. The party is over in that respect."
Rep. Dennis Kucinich, D-Ohio, said $700 billion spent trying to save home could really stimulate the economy, "but that's not what this bill is about," as the Treasury secretary would not have power to stop foreclosures and keep people in their homes.
Rep. Todd Tiahrt, R-Kan., called the legislation "the biggest corporate welfare bill in history," and said fear was driving members away from reason.
Rep. Joseph Crowley, R-N.Y., confessed, "Everyone is angry," but said companies and families will suffer from a lack of credit - and said financial executives should be given metal ankle bracelets and not golden parachutes.
Marilyn Musgrave, R-Colo., said she "simply cannot stomach" transferring wealth from Colorado families to the benefit of Wall Street figures "whose avarice and greed put us in this situation in the first place."
She also castigated Congress for failing to take seriously the crisis of gas prices this past summer, "and yet when Wall Street faced the consequences of its actions we worked around the clock" to bail them out.
Rep. Spencer Bachus, R-Ala., said he was confident that the protections put in during negotiations would mean that taxpayers stand to get their money back.
Bachus said he was not willing to take no action. "I'm not willing to put that bullet in the revolver and spin it. I'm not willing to take that gamble. I'm not willing to pull that trigger because I'm not willing to subject the American people to the worst-case scenario.
"I will take the political risk but I will not take the risk on the American people and their future and their prosperity and their children and grandchildren."
Rep. Rose DeLauro, D-Conn. said, with the prospect of the worst financial crisis since the Great Depression, "I have a responsibility to avert it."
Minority Whip Roy Blunt, R-Mo., said, "If anything we may have overdone the oversight, but none of us want to have underdone the oversight."
"When the markets go up, Wall Street cleans up; when the markets go down, Main Street gets cleaned out," said Rep. Edward Markey, D-Mass. "We must protect Main Street across this country: Vote 'yes.'"
In confronting the opposition to the bill, particularly from the left, and the compromise needed to Rep. Barney Frank, D-Mass., said, "Meeting a national crisis does not give us the luxury of doing everything we want.
"You have got to accept reality. I wish this was a bill that more reflected my priorities. I wish I could eat more and not gain weight.
"The poor people will get nothing if we don’t compromise," he said. "This bill can put in the president's hands the power to do good; please don’t throw it out."
Minority Leader John Boehner, R-Ohio., admitted the unpopularity of the bill: "No one wants to be anywhere around it. I don’t want to be around it.
"These are the votes that we have to look into our soul and understand and ask, 'What is in the best interest of our country?'
"While imperfect, while not having everything everybody wants, I believe we have to vote for this bill and keep ourselves from the brink of an economic disaster that would harm all of our constituents."
Majority Leader Steny Hoyer, D- Md., called it "a day of consequence for the American people. This is a day of consequence to our country. This is a day when the Democratic leader, myself, rises to follow the Republican leader and they speak with one voice as America faces crisis. That’s what Americans want us to do.
"Why should taxpayers loan out their own money to solve a crisis brought on by someone else's greed? Because when it comes to our economy, none of us is an island; we're all bound together, in boom or bust."
"Inaction will result in greater pain for our people and our country," he said.