The Senate vote in support of the measure, which went 74-25 (the ailing Sen. Ted Kennedy missed the vote), reflects the fact that, first of all, Senators, who run representing entire states, are very difficult to unseat because of the huge cost of mounting a media campaign against an incumbent, and second that two-thirds of them even don’t face voters this November, (and one third not for another four years).
The House, in contrast, which defeated a similar bill earlier in the week by 228-205, while still largely an incumbent’s sinecure, is still a place where every member faces the voters every two years.
So now the bill goes back to the House for a second round of voting tomorrow, this time in a version devised in the Senate to try and convince 12 of Monday’s nay voters to switch to yea. The sweeteners: a rise in the size of bank deposits insured by the (already over-stretched) Federal Deposit Insurance Corp. from the current $100,000 to $250,000, and some $115 billion in new tax breaks, some for business, and some for wealthy taxpayers (a raising of the threshold for applying the alternative minimum tax).
In other words, the minimum cost of this bailout, has been raised from the $700 billion that the House rejected last time to $815 billion! And it’s a fair bet that more sweeteners will be added once the bill goes to the House floor. (It should be noted that neither of the measures added in the Senate has anything to do with a rescue. Moreover, the first, upping the FDIC insured deposit limit, is simply a time-saver for the rich, who could have simply moved around money to separate banks to accomplish the same thing, while the second only succeeds in driving the US budget further into the hole.)
The pressures on House members from lobbyists, House leaders of both parties, and from the White House, will be enormous. The question is whether public pressure, which was unprecedented over the past week, jamming the Capital switchboard and crashing the Capital website, will be equally enormous.
If voters again flood their representatives with calls and emails demanding that they not support this rip-off bill, it is still possible that the bailout will die and Congress and the White House will have to go back to square one to work out a more reasonable and fair way to salvage the US financial system than simply putting the results of 15 or more years of reckless Wall Street greed all on the backs of average taxpayers.
As I have written earlier, the proper way to go about this would be for both the Senate and the House to schedule and hold hearings on the crisis and on ways to develop a rescue of the economy and the financial system. Such hearings should include testimony from the victims of Wall Street’s misdeeds—the homeowners who are losing their houses, the small businesses that can no longer borrow funds to finance expansion or to meet short term cash needs, the retirees and workers who are seeing their pensions pillaged. They should include testimony from the hundreds of economists, including Nobel Laureates like Joseph Stiglitz, who are warning that the bailout as currently designed will not work and could make things worse. And they should grill executives of the major financial institutions about how they drove things to this perilous state.
Then they should craft a response that meets the needs of the public, not just the bankers and their investors, that will help to rebuild the economy and the financial system on a sounder footing, and that will punish those who abused the system and who have brought it to its knees.
The Senate vote (which included yes votes from both major party presidential candidates, Barack Obama and John McCain, both the beneficiaries of large campaign donations from Wall Street interests) was a victory for those who caused this crisis, and who hope to receive all the money being put on the table.
The House vote will be a test of whether the public still has any power at all to have its interests considered in what is still referred to as this American democracy.
The advocates of this ripoff, from the President on down, have been using cheap scare-mongering to try to win the day, claiming that if a bill isn’t passed immediately, the country will spiral into a depression like the 1930s. This is ridiculous. The country has been in a credit crisis for months, and if Congress spend another month or two deliberating and devising a good bill, it would not put the country in any greater danger of collapse than it is already in. In fact, this rush to pass a bad bill is far more likely to lead to disaster.
So once again, whether or not you have called your US representative, get on the phone and do it again. Demand that they vote “No” and say if they do not, you will vote against them in November. The numbers to call are: 202-225-3121, 202-224-3121 or 800-828-0498. If you cannot get through, look up in your local phone book blue pages the number of a local constituent office for your representative, and call there. In fact, do that anyway, too. You can also send an email to your representative.
Today and tomorrow are the last chance to stop this travesty from happening. Act today, and don't forget to spread the word.
About the author: Philadelphia journalist Dave Lindorff is a 34-year veteran, an award-winning journalist, a former New York Times contributor, a graduate of the Columbia University Graduate School of Journalism, a two-time Journalism Fulbright Scholar, and the co-author, with Barbara Olshansky, of a well-regarded book on impeachment, The Case for Impeachment. His work is available at www.thiscantbehappening.net.
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Baltimore News Network, Inc., sponsor of this web site, is a nonprofit organization and does not make political endorsements. The opinions expressed in stories posted on this web site are the authors' own.This story was published on October 2, 2008.