Well, America, the first iteration of the Emergency Economic Stabilization Act (EESA) failed in the House yesterday, and the news outlets are aflame with speculations of why this happened. Republicans blame a vitriolic, partisan speech on the House floor by Speaker Pelosi before the start of voting on the bill. Democrats blame sensitive Republicans who place personal feelings above the welfare of the country’s financial system. The elite blame Main Street and Main street blames the elite. You blame Congress and Congress blames you.
It’s true. We’re to blame. The House of Representatives, with elections every 2 years instead of 6 like its supposedly more conscientious and prudent sibling the Senate, closely reflects the temperament of the nation. A “yay” or “nay” vote by a member of the House out of sync with the sensibilities of his or her constituency would threaten reelection. Congress isn’t to blame for this fiasco; they were only doing our dirty work. This bill failed because it should have. Its hasty construction and vague specifics offended parties on both sides of the aisle. The bail out didn’t fail because of partisan rancor. It failed because of an emergence of a bipartisan coalition that collectively said “No.”
What do Representatives Bobby Rush of Illinois and Jim Sensenbrenner of Wisconsin have in common? Absolutely nothing, but as of yesterday they both came together in a most unusual of unions. Rush, a Democrat from perennially liberal Chicago, and Sensenbrenner, on record as the most conservative member of the House, each voted no against the EESA. If this was a partisan affair, one would assume that the most extreme ideologues from each party would have cast different votes. But they didn’t. They voted the same. Presumably not out of allegiance to their parties, but on behalf of the people in Illinois and Wisconsin whom they represent.
Democratic Rep. Jerry Castello, a colleague of Rush, explained his vote of “No” to the Chicago Tribune:
“What is essential is that Wall Street help pay for any program to heal the economy…$700 billion is too much to ask taxpayers to bear without a requisite sacrifice from the industry that bears much of the responsibility for bringing us to this point.”
Democratic Rep. Jesse Jackson Jr., also of Illinois, also voted “No” to the EESA. He criticized the bill for not addressing the root cause of the financial collapse – the mortgage industry. He also outlined specific elements absent from an Economic Stability Act he would endorse:
“This bill is simply a Band-Aid, not a cure, for the financial crisis, and it does little for the hard-working Americans who will pay for it,” Democratic Rep. Jesse Jackson Jr. said in a statement. “It does not go far enough in addressing the systemic and terminal problems of our financial system.”
Jackson said a proposal would need to help homeowners restructure their mortgages to prevent foreclosure, address the need for a second economic stimulus, and outline new rules to increase transparency in financial-related industries. (Chicago Tribune Washington Bureau)
The concerns of Illinois Democrats echoed similar reservations held by Democrats nationwide who voted against the measure. Though Republicans also voted “No” to the EESA, they did so for different, more prosaic reasons. According to WTMJ Radio in Wisconsin:
Sensenbrenner says he’ll vote against the Emergency Economic Stabilization Act because the government shouldn’t inject itself into the free market system.
Despite the distracting incantation of Free Market principles and faith in the Invisible Hand, both Democrats and Republicans came together in opposition to the bill over a single shared value – the defense of the mythical demographic, “Main Street.” I’m sure in the coming weeks we will see NY Times Op-Eds and CNBC tirades berating politicians for creating the artificial distinction between the Nation’s economic security and the financial concerns of Middle America. In literal terms, that may be the case. Millions of Americans from Louisiana to Pennsylvania have retirement accounts and 401Ks invested in the stock market and a precipitous fall in the Dow adversely affects their financial interests as well as Goldman Sachs.
What is inescapable, though, is that there is a fundamental distinction in perception between “Wall Street” and “Main Street.” While media hubs in New York and Washington lambaste the Public for not holding their Congressman accountable for voting against the measure, average voters in the country’s Heartland are already disinclined to trust the federal government. To expect millions of voters in Wisconsin, Minnesota, Ohio and Texas to blindly encourage their Representatives to support a “Bail Out” bill and sanction the Government to use $700 billion of tax payer money indiscriminately to remedy irresponsible, greedy bankers in New York City while Social Security, Medicare and Medicaid are barely solvent? That’s ludicrous. As is the estimation that Americans are stupid or uninformed for not supporting the measure.
Perhaps the “mainstream media,” predominantly stationed in New York and Washington are resorting to fear themselves, like some politicians. Perhaps Bobby Rush, Jim Sensenbrenner and their bipartisan coalition against the EESA are the only sane voices in a debate that at the moment seems to be taking place between Rep. Doom vs. Rep. Gloom. The EESA failed because it was rushed through Congress by the Bush administration and blindly heralded as a necessary savior by the media, whose job it was to educate the public on the pros, cons, merits and assets of the bill. A job it clearly failed to perform. Prudent minds across the aisle came together to exercise their balance to power and truly check the Bush administration’s attempt to “bail out Wall Street,” since panic seemed to grip anchors from CNN to CNBC. Democrats blame Republicans for the failure of the EESA; Republicans blame Democrats. But both voted against it. Cooler heads prevailed.