Last Monday we saw the House make a laudible effort to represent their constituency responsibly and vote against a taxpayer bailout of Wall Street. It was a nice effort, but financial power asserted itself Wednesday with the Senate vote, and again today with the House vote where it passed by a sizeable majority of 263-171. It was signed by President Bush about an hour later. Some politically expedient amendments were added in the Senate version to give House members an excuse for changing their vote.
Now, if the farmer leaves foxes to guard the chicken coop, and all the chickens mysteriously "disappear," I question the wisdom of bailing out the farmer for being dumb enough to let foxes guard the chicken coop, but at the same time one doesn't want to let the farmer starve. I can see the need sometimes to bail out duped farmers. But what I cannot see is bailing out the foxes, which is exactly what this bill does.
It was suggested the House "caused" the Wall Street crash of 777 points last Monday by voting against the bill—however the DJIA downward trend line has been steady since its peak last October. It was also suggested that without the bailout, credit will freeze and government and private operations wouldn't be able to access necessary credit lines to make payroll—however the Fed had already injected an additional $630 billion liquidty in to the system last Monday.
So, I can understand the need to bail out retirement funds that are in jeopardy. But I cannot agree with bailing out the system that caused the problems in the first place. This bill bails out people and organizations that brought us this financial turmoil.
I will comment on details of the bill once the dust settles.