Maybe I’m preaching to the choir on this blog, but I thought I’d post this article from today’s Wall Street Journal as evidence that the fallout from the financial crisis is rippling out ever faster. If you live in a Congressional District where your Member of Congress voted against the rescue/bailout plan, please call their office and encourage them to change their minds.
At this point, I hope that whatever emerges from Congress isn’t too late as the credit architecture in the financial system is already significantly deteriorated and will take months, if not years, to recover. Personally, I am so disgusted with Congress right now I want to scream. The rationale behind the Paulson plan was, as I have argued before, fairly simple. Remove the toxic assets from bank balance sheets so that they would resume doing business with each other and could attract private capital. He acknowledged that systemic reform was needed and expected the new Congress and new Administration to take that up in the New Year. The Plan was a bridge.
Congress, as only they can, have now taken the same basic plan and larded it up with irrelevant provisions in an 11th hour attempt to woo favor with the electorate before November 4th. How this makes the plan “better” is beyond me? Frankly, anyone who votes for the plan today and didn’t vote for it on Monday should just put a “For Sale” sign on his office door.
Ah well, we get the government we deserve.