David Gergen | Bio
CNN Senior Political Analyst
The vote by the House of Representatives today against the bailout bill was one of the worst mistakes I have ever seen the Congress make. It was shockingly irresponsible.
Yes, it is true that Americans are deeply offended by the idea of this bailout and yes, it is inconsistent with principles of a country that believes in free enterprise. But it represents an urgent and temporary intervention by the only institution in our country that can stabilize the financial markets and head off a potential calamity for millions of Americans.
Every Member who voted against the bill today should be held personally responsible at the polls this November if people are badly hurt by this.
In the meantime, one can only devoutly hope that our political leaders on both sides of the aisle can resurrect this bill and get it - or a close cousin - passed immediately. This is a dangerous moment for America.
Filed under: Bailout Turmoil • David Gergen • Economy • Raw Politics • TV
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Where were the adults in the room?
Pelosi was wrong to present the bill using partisan language.
But the Republicans committed the far greater sin by hiding behind the insult to torpedo the bill.
Guess what folks, the choking of the credit markets is real. Small to medium size businesses are suffering because their own customers cannot get credit to pay them what they are owed. The dominos started to fall months ago and the process will now accelerate because of the partisanship.
The Republicans had a golden opportunity to take the high road and blew it.
Since the everyday tax payer and (children of our future) will be paying off this debt...Congress should give main street the money. We'll pay off our mortgages. That will help curb the foreclosures & restore cash flow to the banks. We'll pay off our vehicles and then maybe upgrade, promoting industrial growth. We'll shop in our local communities to help keep our jobs and our neighbors jobs. At least the money will stay in the U.S. and we'll know where our money is going to.
I seem to recall Mencken once commenting that no one would ever go broke underestimating the intelligence of the American people. Why would anyone believe that did not also apply to their representatives?
Frankly, Im surprised the bill did not pass. Congress has given Bush all the other money he's asked for, at taxpayer expense, why should now be any different? Give everyone homeowner $20k on their mortgage and force these companies to refinance these loans into more ethical terms. That's what will fix our economy.
I think its really funny that all the blame goes to the Republicans!
Do the math! Why didn't the Democrats all sign on? and why did Pelopsi go after the other side right before the vote? Why isn't anyone upset at that? What kind of political move was that?
And for all of the people that are loosing their retirement in the stock market-Wake up- its just legalized gambling- nothing else- there is no guarantees- that is how it works- my tax money is for people who don't have anything- who need the gov...not fools and crooks
Don't believe the lie- we don't need credit- learn to save! or our country will fail.
take a little personal responsibility-
Great game to all those to all those who
didn't want to bail out these companies, just wait until you don't
receive anymore paychecks because the companies you work for go under. I don't understand why everyone couldn't seem to realize that this crisis needed immediate action to fix the problem first, there was and will be plenty of time to go after the parties responsible for this mess. It's like watching a breaking dam due to shoddy construction, but everyone in town refuses to have it fixed until the construction crew is held accountable instead of fixing and reinforcing the dam walls, then when all is said and done, take the construction company to court.. Now the damn has broken and we better hope we got our swimming trunks on, cause we'll be swimming in this mess for a while.
You admit that the American people oppose this in overwhelming numbers. Do you not care about representation in a Republic such as ours?
You admit that the bailout is "inconsistent with principles of a country that believes in free enterprise." What then are principles for, if not to help guide us out of the most dire of circumstances?
Besides, no one as demonstrated that this is a widespread collapse. We are not in a depression, or even an official recession. Unemployment is relatively high, but not unbearable or out of control. A few businesses are closing, but most are doing just fine. The ones that didn't buy into the subprime craze are thriving. The economy is showing signs of a typical downturn, a market correction. We'll make it just fine without a bailout.
I am completely disgusted with our political system.
In my opinion, these politicians better get back into whatever meeting they need to and figure out the have to do to get this economy stabilized. They should not be at home or taking a break until they figure it out It is completely unacceptable that we are at this point as a country.
I don't blame anyone for not supporting this lousy legislation. It was, as I heard it described, "A cow pie with a marshmallow in the middle". Way to go dems and pubs that had the guts to not jump on the manure truck. Letting this correction happen may hurt (and may hurt bad) but we've been worse-off and will bounce back. For those that worry that nobody's going to take care of them – step-up, take responsibility for your own survival, or die. This is nature's law, plain and simple – Darwin was on to something there.
I hope these simple-minded people who are so happy for the no vote have plenty of cash on hand and will not need any credit in the future. Hope they have saved enough cash for a new car or even a used one. Forget about credit for unexpected emergencies and student loans – there must be a lot of cash cows out there, and oh yes forget about getting a good fixed mortgage rate for a new home. These people have sold themselves down the river along with the rest of us. The Republicans are upset because someone hurt their feelings. What kind of idiots are in Congress, Oh, and God help them if they have any mutual funds or stocks.
I believe the majority of tax payers have no idea what the consequences are of this bill not passing. People who are saying "give the money back to the tax payers" and are coming up with dollar amounts in the hundreds of thousands clearly do not understand the economics. Keep in mind that all public companies are owned by private citizens like you and me. We could see our retirement savings cut by 20 or more percent. Which would be A LOT more than the $5,000 (per tax payer) "bad investment" this bill represents. Wait...Americans don't save, do they? that's why they don't care about this bill. So, basically, all you irresponsible spenders are crying foul about trouble for which yourself are partly to blame.
Did you ever hear such crap? The GOP votes no and blames Pelosi. Haven't they ever heard of "sticks and stones". Silly...and is Mc Cain suspending his campaign again...?
Any just what makes anyone think that freeing up $700 billion so the banks can foist their bad paper on the American public is going to loosen up credit markets? The problem is about credit first, then liquidity. Is giving Wall Street a bag of cash really going to get them lending again? The central banks and the Fed put up $620 billion worth up liquidity but it doesn't look like much has changed. Is there something magical about the taxpayers' $700 billion that will fix everything?
Torpedoing this bill is about the only thing the Republicans have done right in the last 8 years. Let the financial sector bail themselves out, and leave public money out of it. Wall Street flew to close to the sun, now they can burn.
This is what we get as a nation for years of ignoring the very poor educational system (the only one available to must of us) in our country. I'm wondering how many in Congress are even college educated? If you do not learn from history, you are doomed to repeat it. We need the bailout. I'm embarrassed for the U.S.A. Once again, we act like children and to the rest of the world is watching.
The powerful in this country want the everyman in the U.S. to be under-educated so that they can easily use emotional appeals, more than intelligent comments, to sway voters. Now that the rich leaders of this country need a vote to get what we ALL need, the voters are collectively too ignorant to depend upon. Democracy cannot work with an ill-educated population.
i totally agree with anthony...give the money to the people! why is everyone so angry at the house for voting down a taxpayer sponsored 700 BILLION dollar bill. everyone is acting like the sky is falling....worse things can happen people! do you REALLY trust the government with 700 billion of your hard earned dollars? who is this truly going to benefit and when? most importantly....where the heck is all this money gonna come from? do the math....with the 85 billion the government bought AIG for would be enough to give every adult american citizen 300,000 dollars AFTER a 30% tax cut sending money right back to uncle sam.....why aren't we asking for a bill like that....what couldn't the average citizen do with those funds? As for the politicians, they are all idiots, and i guess that makes us morons for voting for them
For all of the people who believe the bailout plan is to help the rich bankers and/or wall street brokers are buying too much into the media's spin on this. The crisis here is not that some banks will fail, but rather that banks have stopped lending. So forget the effect that not enacting the legislation will have on the average person's life savings, failing to act will result in people losing their livelihoods. When businesses cannot get the loans they need to operate on a daily basis, the owners and corporate executives will find ways to protect themselves and will have the assets to weather any storm. On the other hand, when their is a money crunch on businesses massive layoffs will occur (I'm an employment lawyer and I have already seen it happening). The average worker will get laid off. With housing values plummeting and our general bad saving's habits, the normal working american will have little safety net to fall back on. So the middle class and poor are the ones who are going to suffer, not the people at the top.
Thus, the question that should be posed to americans is, would you rather shoulder a potential tax burden of a few thousand dollars now, or not pay taxes at all because you have no income? That is the choice many people will be facing if this is not taken care of very soon. Unfortunately, this is the side of the equation which is getting little if any press, but should scare the heck out of anyone with any sense.
Why did Congress vote no, because an ill-informed public who votes for them has been convinced that their tax dollars are being spent to bailout rich investment bankers. The politicians are not interested in what is right for their constiuents, only how they will vote when it comes time to do so. Remember, the politicians have no financial stake in the economy going down the tubes (especially if everyone believes greedy bankers are to blame)– most are guaranteed to have their jobs long after those who voted for them lose theirs.
When are people going to say: "I'm mad as hell and I'm not going to take it anymore?" Remember the movie?
Are we just sheep to be controlled by our puppetmasters?
I say let it all fail.
Then we can start over with a new system. A little anarchy is a good thing.
This bloated system of government by and for the Fat Cats has never had the average American's best interests at heart.
I am plowing out the grass in my front yard and will be planting food–lots of it–with a really big fence. And some solar collectors on the roof.
I guess all these years those survivalist nuts were on the right track!
We are on our own, folks.
If Congress really wanted to protect Main St. they would set up a multi-billion dollar trust fund to save the commercial banks. The commercial banks are the ones most people go to to seek a personal or business loan. But it appears that the smaller commercial banks (WaMu and Wachovia) are now being absorbed by the bigger banks. If that continues to happen, we will only have 4 or 5 major banks available for personal or business loans. With less competition, there is less room for negotiating the best deal.
I realize that the failures on Wall St. affect retirement accounts, but since the market can under go serious fluctuations for various reasons, we shouldn't be bailing out these firms for poor management and their own greed.
I'm a single mom, have a graduate degree, 25 years of work experience, and an excellent performance record. Yet, I've been unemployed for six months and don't see any relief in sight. Do you think for a minute that I would bail a bunch of corporate scoundrels out when they won't even give me a job???
It would interesting to track the number of suicides that occur due to the upcoming calamity.
Talk about destruction!
Anyone who is not willing to accept the risk and reward of the free market system we had until recently - including the legislators and President - should either be tried for treason or put on a boat and sent on a 90-mile journey to Cuba. Our regulatory structure and quasi-governmental agencies like Fannie and Freddie were bad enough that now we have Congress openly considering having the US taking equity positions in all of our banks, insurance companies and other institutions which may have made bad investments.
Congress supports an unpopular war that costs Americans soldiers their lives, increases our national debt, and ultimately leaves us empty handed.
Congress rejected a bill that takes action, has no cost of human life, increases our debt temporarily, but has a chance of success that is exponentially greater than that of the Iraq war.
My fellow Americans, where are our values truly located?
This one of the most courageous things congress has do in a long time.
It restores some part of my faith that when pressed hard by the people
congress is still responsive. This was a rip off by the same people who
got into this mess. Some people think the people against this are just uninformed. I for one am not I have 3 degrees from Harvard. I am just outraged. Congress should not be bullied or blackmailed. Take a poll. You know the people are hughly against this. As your parents or grandparents who went through the great depression. The comparison is ludicris.
This is why the great philosopher Aristotle once claimed, Democracy may be the worst political system of all.
We empowered the opinions of everyday people who know nothing of this situation, but ignored the wisdom of the few.
To those that agree with a bailout – feel free to give your money to these corporations. I for one am glad this did not go through. I don't agree with these quick rush "fixes". No one is being held accountable for what happened and that goes from the government down. I refuse to pay for others irresponsiblitly.
Somewhere it says "WE THE PEOPLE". Oh Ya, it's the preamble to the constitution. I am glad I did not forget unlike the people in the congress of this United States. I think it is time for WE THE PEOPLE to stand up and get rid of these idiots in Wahsington. They act as though they are almighty and all have the ansewers. They obviously do not. Infact, I would say none of them even now what is going on in the world let alone the back yards of the epople thay are supposed to represent. It is time for WE THE PEOPLE to take back the greatest country to ever be and re-gain the respect of the world rather than sit back and let our elected officials make fools of us on the worlds stage. Lets not impeach the President. Impeach congress and lets start over!
"The Party is Over" – but we hav'nt kicked the bums out of the house yet.
My husband and I were watching the news about the economy. We thought... since we all are citizens of the United States... Why not ask the citizens to save the economy? How? Simple... ask all registered citizens to send a donation of $1.00 up to $100.00. What ever they can give, but not to exceed the $100.00 limit. If all of us were to do so, we can collect enough to save the economy and stop taking loan over loan. We are not financial experts, but sometimes the solutions are more simple than what we really think. Please consider this option and lets all contribute to save the economy. Thank you!
I thought the Democrats controlled Congress. If that is true, then shouldn't they have had enough votes to pass this thing?
Oh wait, many Democrats voted against it. This isn't just the Republicans fault. Squirrels.
They truly are the "Do Nothing Congress".
The fact that the House rejected the bailout bill is good for America and its people. I hope it stays that way.
What a bunch of little children. If the GOP voted against the bill becuase their feelings were hurt by Pelosi’s speech…that’s
just to darn bad They should grow up and do what is best for the country not their egos. John McSame has turned into an angry bitter little man. Imagine the mess him and Palin could do to this country. Something for all you undecided voters out there to seriously think about.
I don't agree with you one bit. We have large deficit already, and that money would make it even bigger. Why those of us who made right decision have to pay up in taxes to save thieves and cronies from Wall Street?
Those who voted against it have my regards and my sure vote come election day. They save money for me and any other taxpayer. The rest of Wall Street should get real job, there is shortage of cherry pickers and we have to import them from Mexico I think cronies from Wall Street should be able to handle this task
From what I've been reading, what the consevative right who voted against this, want private investors to be included in the bailout/rescue. But to make this happen would require tax breaks and a change to lighten some regulations ti make it worth while to investors. Tax breaks still affect the dollars we have or don't have in the treasuary. ISN'T TAXBREAKS AND DE-REGULATION WHAT GOT US INTO THIS MESS ?
Thanks for all your insights David. I think more than any other you offer some of the clearest insights into a system that in so many ways appears corrupted.
I listened to Glenn Beck earlier and he mentioned a scenario similar to the Great Depression. In some ways, as much as it would hurt everyone, I think it’s what this country needs. We need to get knocked down off the high horse and once again look at what principles and values we were founded on. We have lost all sense of vision and purpose. Yes, it should have been passed, even if people were against it, not as a means to resolve the problem, but to at least buy time to hold people accountable, take responsibility, and then face the reality of a depression/recession. Money won’t resolve the problem; only an honest evaluation of the system will do that.
If it isn’t time now, that day will come because we can only build towers so high before we have to jump off and face the fall.
First let me say that George Bush lost credibility with the American people and his own party a long time ago. Forgive me, but I can no longer bear to even watch him on television. I do not believe that he has the slightest idea as to complexities involved in the bailout bill. It is laughable to me to see him give a speech about a topic in which I truly believe he knows very little about.
Also, it is a bit disingenuous to fault borrowing on the part of consumers when the government has borrowed almost a trillion dollars and are in hock to the Chinese up to the eyeballs,
The unregulated financial institutions (via credit card interest rates and penalties) were unleashed on the American people like wolves on a rabbit. The pushed up interest rates and piled on penalties to the point to where it literally broke the back of the consumer. The last credit card I had (which went into the trash) went up to 28% interest. This is way more than what a loan shark would charge.
I guess what I am trying to say is that the corporate greed in this company finally went over the wall of what two incomes can afford.
Things are so out of control now that people have to borrow money to stay out of hock for health care costs. Health care costs have skyrocked while insurance companies continue to reduce their coverage and increase out of pocket expenses.
I agree . . . but . . . every congressman who voted FOR THIS BILL should be voted out of office, tarred, and feathered. Period. Socialistic bailouts for corrupt, criminal dealers on Wall Street? Let them jump from windows again; if they will not jump, we should PUSH them out.
Give the money to the people. They will stimulate the economy.
and VOTE FOR REAL CHANGE OBAMA/BIDEN. WE can't take more of the same.
How dare mccain say that Obama sat on the side lines and let this happen. Who has sat in congress for 26 years while we have been going down the tube .
Obama sat for 2 years and realized that the country needed change.
Maccain we are smarter than a someone graduating last in his class.
Your comment reflects my anger with todays disaster. I am newly retired and cannot believe what is happening in Washington. Politicians are fiddling while the USA burns and I'm helpless watching my money dissolve.
For those of you cheering because the House "stuck it to the rich" consider that a majority of those hurt the the 700 plus point drop in the market are those who have already retired and don't have time to save more and the average people who have just been trying to set aside enough money to retire one day who now have lost 20%, 30% or more of their savings. Even solid stocks have lost money. If the "rich" people are hurt, then they do not put money into the economy and the companies do not grow and the average person can not find a job. Like it or not, our economy has a trickle down effect. No one liked the idea of having to do this bailout but a lot of people, including Warren Buffet, said it would work and the government would make money. No it would not solve all the problems but it would help.
Finally, for those of you blaming the Republicans, you should remember that if the Democrats who voted against it would have voted for it, the bill would have passed.
I think that all yes votes should be voted out of office in November. I don't understand why the responsible, tax-paying, mortgage paying citizens should be dealt with another burden on our shoulders to assist those that were irresponsible to begin with. This is a free economy and if a business is going broke/bankrupt due to lack of good business ethics on their part, then, down the drain they go! I agree with some of the other comments; give the people that have good credit, have paid their mortgages faithfully, a nice fat check to payoff their own mortgages and spend the rest for what ever they like. Talk about a boost to the economy!
Incumbents that voted against this bill should be voted out!
I don't understand how McCain can blame Obama when it was the Republicans who voted AGAINST this measure. The real problem is that McCain is unable to pull his own party together across the two chambers to save our banking system.
Yes, I'm angered that when I can barely afford to feed our children and heat our house to pony up billions to support an industry that has shown nothing but greed in terms of excessive compensation.
I'm disgusted by our banking system, McCain, our Congress, and our President. This month has been one of the worst in our nation's great history. Seems like everything we touch is ruined. Congress and McCain had better get it together, put some concrete elements into this bill and sell it again!
What we need is regulation. If we give 700 Billion to Wall Street to get them out of their hole, they will only do it again to make a buck. Derivatives and Short Selling is the culprit. You can't make money from nothing. Someone eventually will have to pay, and in this case it is us (in form of the government). We need to prevent this from happening again by regulation, not deregulation.
A reckless bill.
As wonderful and more practical as it would seem to just give everyone $500k or $1m, that would create bigger problems. Then everyone would have more money and inflation would be astronomical. If you knew that everyone had that much money, how much would the cost of goods go up, knowing that the market could bear the burden of the price. It sounds great, but inflation would be worse.
If it was such a noble thing to vote for, why did 1/3 of Democrats not even support it? You had more Democrats vote for the Iraq war than this bill. What does that say about the bill itself?
And what about that Pelosi speech? No where did she mention the fact that it was her party that started demanding Federal mortgage companies give loans to people with bad credit. What did private companies have to do to keep up? Offer even more loans to people with bad credit. What did you honestly expect to happen when you pass laws requiring banks to lend money to people with a track record of not being able to make payments?
The blame goes both ways, but you wouldn't know it by listening to Pelosi. And for the record, I wouldn't even buy a used car from Barney Frank.
Why should people that bought a $500K house with a $40K salary be bailed out at all? If you can't read/understand the paper work when buying a house, then get someone who can, and don't blame 'greedy executives' because you didn't do your job. I say let them all fail, the irresponsible homeowners, the banks(althought most of the institutions we are talking about aren't banks), and the wall street money managers who gambled and lost.
I am very proud of the heroes who stood up for The American people and voted "No". It is not very easy going up against big money to do the right thing.
Yeah, anyone voting against this bill should be held accountable come time to vote. They should be voted FOR. At least they stood up for what the American public wants and not some fat cat crooks. Krank said two things that pissed me off. First: its not going to hurt the big bankers or corp. execs if the bill doesn't pass, its going to hurt the average American taxpayer. OH YEAH ???? Well guess what, I'm willing to give it a try..... Second : there is a mountain of private money out there just waiting for this bill to pass so it can be invested and give liquidity to the market. SAY WHAT ???? I can tell you that the "mountains" of money sure isn't in the hands of the average american so it must be in the hands of the big bankers and corp. execs and participants in unregulated off shore hedge funds. I say, let them pay for their greed as I sure as hell am not . And thats what I'm saying.......