Fit To Print

Paling at the Thought of an Administration with Carte Blanche

September 22nd, 2008

I know as much about the economy as Sam Cooke knows about history, but there seems to be a remarkable consensus among economists that that the bailout, as currently proposed by Paulson, is a bad idea. Congress needs to attach at least three things to any huge financial commitment such as this: significant safeguards to allow the government to recoup its investment, stricter regulations on how these institutions operate in the future, and additional stimulus and economic relief for the people about to lose their homes and/or jobs.

Obviously, the devil is in the details, and opinions vary on how to structure each provision, and whether there should be other goodies included, like a CEO salary cap. This bailout could very likely hamstring the domestic agenda of the next administration, so Dems need to make it worth the public’s while. The two keys are explaining to the public why just throwing money at the problem won’t solve it, and keeping skiddish Dems in Congress from letting the urgency of the situation scare them into signing some few-strings attached bailout that contains only token provisions of regulation and investment guarantees.

While there are factors that could screw things up for Obie, I think the election is his to lose at this point. Obviously, there is a real temptation to just go with the flow on this bailout (some people see his opposition to the Paulson plan as weak, some see it as “yay Obama!”). But this is a critical issue that will have repercussions for a long time to come. Now is the time to demonstrate real leadership.

There are some aspects of the Obama campaign that I really admire. I think their organizational muscle has been impressive. David Plouffe is a badass. A lot of Obama’s responses to the McCain attacks have been excellent. But sometimes I have doubts about the leadership issue.

But it seems entirely possible that Obama will win this election much in the way that McCain won the primary; by being the last man standing after everyone else proves themselves irredeemably flawed. If you give Steve Schmidt a more charismatic and effective candidate, I think Obama loses this election. Hell, if you give Schmidt the McCain of 2000, Obama probably loses this election.

And that is despite all of Obama’s charisma, character, and massive appeal to younger generations. You can blame some of the closeness of the race on fears about color and “otherness”, and ignorance, and all the rest. But I also question the decision to stop talking about foreign policy simply because McCain said, “I see your opposition to this disastrous war and raise you a measly surge.” Or being afraid to discuss climate change because “drill, baby, drill” was the biggest applause line at the RNC.

So in sum, I’m doubtful that Obama and Congress are up to the bailout challenge. I think the most likely outcome is a quick “carte blanche for Hank” type bill, and I actually expect Pelosi to mount tougher opposition to such a bill than Obama. But if he proves me wrong, what a wonderful presidency this would be.

Entry Filed under: Politics, White Papers