Like my esteemed Keloland colleague, Cory Heidelberger, I don't know quite what to think about the $700 Billion bailout package just passed by the House of Representatives. On the one hand, I am very uncomfortable with big government interventions into markets, and, as a committed Federalist, I am equally uncomfortable with giving the executive branch that much money to use as it pleases, without any real legislative control. On the other hand, I can't help noticing that economic distress is following financial distress across the globe, and that signs of recession are appearing in our own general store. A recession with a financial collapse on top of it might be real trouble. This sort of thing is precisely what Alexander Hamilton thought the executive branch was for. So what's a Federalist to think?
Reluctantly, I think that the voting for the "bailout" was the right vote. It may well be that there were better alternatives, but Secretary Paulson pushed this one for the simple reason that it worked in the past.
My Keloland colleagues were very interested in how our Congressional delegation voted. But there is no mystery here. My equally esteemed Keloland colleague, Todd Epp praises Tim Johnson as a "budget hero." Allow me to suggest that if the economy slides into recession, the budget numbers will not improve. Johnson and Herseth Sandlin (twice!) both voted against the bailout for an obvious reason: it is very unpopular, and they are both up for reelection. John Thune voted for it, because he isn't. We may be inclined to see this as craven, but that would be a mistake. These people work for us, and we have every right to pressure them into doing what we want.
Now we get to see whether Secretary of Treasury Hank Paulson can put out the fire. Ronald Reagan once said that the test of his presidency was not whether his policies were popular, but whether their results were popular. There is a lot of loathing directed at Wall Street for the current troubles. There is fear both of the voters' loathing and of the possibility of economic catastrophe on the part of our Congress. Let's hope they have managed the one and the other.
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