Well, it’s done. The House of Representatives has voted 263-171 in favour of the $700 billion dollar bailout plan.

Now that it’s over I suppose there’s one of two things that Americans can do.

1) Read today’s headlines and then carry on with their lives, which many will do given that they have their own daily survival to worry about.

2) Remain vigilant and make an effort to hold their representatives accountable if those on Wall Street that were responsible for the crisis eventually profit from it, which is certainly not out of the realm of possibility.

October 3, 2008 43 Comments

Congress will vote tomorrow whether to back a Senate revision to the proposed $700 billion dollar economic bailout package. The President, as always, continues to play the fear card, claiming that it is an issue that goes beyond Wall Street and that the House Of Representatives has a responsibility to average Americans to support the deal and thus instill a sense of stability. Of course, the House’s rejection of the initial bailout plan was very much aligned with public sentiment, something that the White House continues to overlook.

In today’s Guardian, historian Howard Zinn provides commentary with regards to the crisis which is noteworthy…

“This current financial crisis is a major way-station on the way to the collapse of the American empire. The first important sign was 9/11, with the most heavily-armed nation in the world shown to be vulnerable to a handful of hijackers.

And now, another sign: both major parties rushing to get an agreement to spend $700bn of taxpayers’ money to pour down the drain of huge financial institutions which are notable for two characteristics: incompetence and greed.

There is a much better solution to the current financial crisis. But it requires discarding what has been conventional “wisdom” for too long: that government intervention in the economy (“big government”) must be avoided like the plague, because the “free market” will guide the economy towards growth and justice.

Let’s face a historical truth: we have never had a “free market”, we have always had government intervention in the economy, and indeed that intervention has been welcomed by the captains of finance and industry. They had no quarrel with “big government” when it served their needs.

It started way back, when the founding fathers met in Philadelphia in 1787 to draft the constitution. The first big bail-out was the decision of the new government to redeem for full value the almost worthless bonds held by speculators. And this role of big government, supporting the interests of the business classes, continued all through the nation’s history.

The rationale for taking $700bn from the taxpayers to subsidise huge financial institutions is that somehow that wealth will trickle down to the people who need it. This has never worked.

The alternative is simple and powerful. Take that huge sum of money and give it directly to the people who need it. Let the government declare a moratorium on foreclosures and give aid to homeowners to help them pay off their mortgages. Create a federal jobs programme to guarantee work to people who want and need jobs and for whom “the free market” has not come through.

We have a historic and successful precedent. Roosevelt’s New Deal put millions of people to work, rebuilding the nation’s infrastructure, and, defying the cries of “socialism”, established social security. That can be carried further, with “health security” – free health care – for all.

All that will take more than $700bn. But the money is there. In the $600bn for the military budget, once we decide we will no longer be a war-making nation. And in the swollen bank accounts of the super-rich, by taxing vigorously both their income and their wealth.

When the cry goes up, whether from Republicans or Democrats, that this must not be done because it is “big government”, the citizenry should just laugh. And then agitate and organise on behalf of what the Declaration of Independence promised: that it is the responsibility of government to ensure the equal right of all to “life, liberty, and the pursuit of happiness”.

Only such a bold approach can save the nation – not as an empire, but as a democracy.”

October 2, 2008 31 Comments

From the BBC…

“The lower house of the US Congress has voted down a $700bn (£380bn) plan aimed at bailing out Wall Street.

The rescue plan, a result of tense talks between the government and lawmakers, was rejected by 228 to 205 votes in the House of Representatives.

About two-thirds of Republican lawmakers refused to back the rescue package, as well as 95 Democrats.

Shares on Wall Street plunged within seconds of the announcement, after earlier falls on global markets.

A White House spokesman said that President George W Bush was “very disappointed” by the result.

He would meet members of his team in the coming days to “determine next steps”, spokesman Tony Fratto said.

The vote followed a day of turmoil in the financial sector.”

[…]

“So grave are the consequences of this decision, reports the BBC’s Kevin Connolly from Washington, that the speaker of the house paused for several long minutes after the vote was taken before declaring it official.
The no vote plunged the world of Washington politics into turmoil and the markets into deep and instant chaos with rapid falls on Wall Street, our correspondent says.”

A comment left by a reader from Baltimore summed it up…

“I am glad the bailout bill failed. I work five days a week, save cash and pay my bills. I did not want to pay for Corporate America’s greed”.

Global Impact

» Wachovia, the fourth-largest US bank, was bought by larger rival Citigroup in a rescue deal backed by US authorities.

» Benelux banking giant Fortis was partially nationalised by the Dutch, Belgian and Luxembourg governments to ensure its survival.

» The UK government announced it was nationalising the Bradford & Bingley bank.

» Global shares fell sharply – France’s key index lost 5%, Germany’s main market dropped 4% while US shares plunged after the vote result was announced.

Update

I’m not one to happily use Lou Dobbs to demonstrate a point, but in this instance it’s pretty relevant (tip: satchboogieca)….

September 29, 2008 43 Comments

Congresswoman Marcy Kaptur of Ohio’s 9th District is absolutely on fire. Once again Kaptur takes to the floor of the House to deliver yet another outstanding address on the current financial crisis…

September 24, 2008 17 Comments