The House threw another wild card in the campaign today by rejecting the bailout plan by a somewhat comfortable margin (228 noes, 205 ayes). This could mean many things to the world economy, to the Wall Street meltdown and to the Capitol Hill negotiations - but this is and remains a campaign blog, and 5 weeks from Election Day a story like this is likely to have quite significant electoral repercussions.
The Bush Administration and most lawmakers were hoping to be done with the bailout debate by now, and the most obvious consequence of today’s vote is that the financial crisis and the bailout will remain on every newspaper front page for the days to come. This is very worrisome news for Republicans, who have been steadily going down in the polls since the political focus massively turned to the economy. John McCain tried to seem more in control of the story by suspending his campaign last Wednesday, but that gamble doesn’t appear to have done him much good and polls continue to show Barack Obama with a large lead on who can best manage a financial crisis and economic issues.
For John McCain to have hope of pull off this election, upcoming news cycles need to be dominated either by breaking international news or by character-based stories. The GOP was very successful in propagating the latter the first half of September, but Wall Street’s meltdown makes it difficult for lipstick-related controversies to go viral - and it now looks like that trend will continue.
But there are a lot of questions surrounding the bailout’s failure and what political impact it might have:
- Will there be another vote, and will the outcome change?
- Who will get the blame? Right now, the House GOP is blaming Nancy Pelosi, John McCain is blaming Barack Obama, and Democrats are blaming Republicans. It would seem that it will be easier for Dems to win this argument, since 67% of House Republicans voted against it, while a majority of Democrats supported it.
- Is it even a bad thing for one party be assigned blame here? Most polls show that the bailout plan was deeply unpopular, and it is telling that most endangered incumbents from both parties (with some rare exceptions like Reps. Kanjorski, Kirk, Mahoney, Porter and Shays) voted against it. Five weeks from Election Day, those representatives who would be the most likely to feel voter anger did not want to take the risk to go back home and be hit by their opponents on this issue
So could the failure help McCain if voters come to be grateful that Republicans blocked the bill? That might have been the case had the Arizona Senator chosen to take a more oppositional stance. But tens of millions of viewers saw McCain defend the principle of the bailout at the Friday debate and said that “sure,” he would support it. In fact, not only did McCain not oppose the bailout deal but he moved to take ownership of congressional negotiations with his campaign suspension last Wednesday and insisted that he would be able to bring House Republicans on board.
This is what McCain’s campaign manager Steve Schmidt said yesterday on Meet the Press: “What Senator McCain was able to do was to help bring all of the parties to the table, including the House Republicans, whose votes were needed to pass this.” To the extent that it is House Republicans who caused the bill’s collapse today, McCain’s decision to suspend his campaign looks like it could backfire even more than the week-end’s tracking polls suggested. On the other hand, Barack Obama had less at stakes in the day’s vote since he hadn’t invested himself as publicly as his opponent - though enough to not look like he did not care about the issue.
As for congressional elections, the fact that so many endangered incumbents voted against the bill somewhat removes this from becoming a major issue in the final weeks of the campaign, at least at the House level. For instance, Suzanne Kosmas of FL-24 had positioned herself to hit Feeney, but his negative vote today complicates that maneuver (though she can still use his ties to mortgage companies). In districts in which the incumbent voted for the bill (PA-11, FL-16, IL-10, NV-03 and CT-04, for instance), expect the challengers’ to make this an issue, even if some of them had said they were open to the bill themselves.
September 29, 2008 at 5:12 pm
How can McSame claim he can bring the parties together when he can’t even bring his own along? Some leader.
September 29, 2008 at 5:30 pm
Pelosi gave a very partisan speech and that is why it failed. As Speaker she had an obligation to keep politics out of the passage of this bill. Instead she got up and bashed “the Bush administration’s failed economic policies — policies built on budgetary recklessness, on an anything-goes mentality, with no regulation, no supervision and no discipline in the system.”
How can anyone blame so many Repubs for voting with anger against this? Take off your partisan glasses and see what’s going on here. It’s her fault this bill failed.
September 29, 2008 at 5:39 pm
She stated what she (and the experts) believe how this came about. As the nation was about to let go of billions of dollars to fix it, why not note that those types of policies needed to change? Republicans need to step up to the plate and acknowledge that their policies caused this and help America get out of this crisis. By whining that “she was mean to me, so forget America” is another reason why they should all GO.
September 29, 2008 at 6:25 pm
You are incorrect in saying that because both sides were split on the vote, that it will be a wash. In fact, many members of Congress from both parties are going to be dumped on election day. This bailout was a huge deal, big numbers, yet never really explained to the American public. Why wasn’t President Bush on the road explaining this bill and drumming up support for it with the public. In fact, on Sunday, he was on the road taking a 2 hour bicycle ride. The entire bill was negotiated in private. The corporate big shots will be sure to profit from this. There is a lot of blame to go around. What is the role of hedge funds in pushing the markets to obscenely high numbers? Why was Goldman Sachs able to buy WAMU for a mere pittance. Why is Warren Buffett able to go shopping and buy shares in companies if there is no money around? There is plenty of money around.
September 29, 2008 at 6:37 pm
Gerard,
I never said that it will be a way because both sides were split. I said that it will not affect most congressional races because most endangered congressmen voted against it, thus depriving their opponent of an effective argument.
September 29, 2008 at 6:45 pm
Taniel,
I apologize if I paraphrased you incorrectly. My point is that a lot of members who are in “safe” seats are going to be in a tough spot on election day. No one I talk to has any sympathy for Wall Street. No one in either party has made a convincing case for why this should be passed. It takes a certain arrogance on the part of Washington pols to think they can push this through and we will all be fine with it.
September 29, 2008 at 6:46 pm
I wonder what those who voted against this bill will do next week when factories start laying off workers because the can’t buy materials to build whatever they are building or meet payroll. Calls may switch from 300-1 against to 300-1 for passing the bill.
McCain is in a box. He said he would get the bill passed and he failed. Now he owns it. Even if the bill gets passed in a few days it takes him off message. He will be tied up trying to get Republican support to pass the bill and dealing with the growing sence of panic over the Palin situation.
September 29, 2008 at 6:51 pm
Gerard,
One thing about American politics is that the overwhelming majority of incumbents are unlikely to fall below 60% whatever they do, whatever happens. Most of those that were even vaguely at risk have voted “no.” A few haven’t, and that will be exploited by their opponents - though some of the challengers have also voiced some kind of support for the bailout.
September 29, 2008 at 10:05 pm
Gerard, the problem is that many congressmen/women in both parties gamed their votes, based on voter anger which was understandable but sadly misinformed. We can roll out the tumbrils to bring the villains to the guillotine a little later. Right now, we have a world-wide credit crisis, and we needed to do something about it pronto. (The Australian market opened shortly before I wrote this and tumbled 4% in the first 15 minutes.)
I’m a Democrat and harbor no illusons about the GOP - please don’t blow in our ears about how Pelosi injured their sensitive feelings to the point that they acted against national interest in retaliation. However I’m furious at the Demo Left which cooperated in cratering a bill that was probably as good as we’re going to get in present circumstances.
Kucinich and his gang wold just as soon wave the bloody battle flag from the ramparts as make good decisions. They’re no less dogmatic and rigid than Cantor and his crew of scoundrels.
If they don’t get this squared away fast, a lot of voters who are marching around waving placards will be unable to borrow money or use their credit cards, and some significant number of them will be looking for work at Taco Bell. Sure, W was AWOL and Paulson did a horrid job explaining this, but we’ve seen enough examples of stupidity, anger and outrage as a substitute for intelligent thinking. It’s time to use our brains - and to elect people to Congress who do, instead of worrying about their polling data.
September 29, 2008 at 10:40 pm
Perhaps the Democrates need to do this on there own. Put back the the bankruptcy legislation and acorn provisions (Whatever they are?) and get whatever Republican support they can. Wall Street and the White House will scream, but be forced to sign on. In the short term some voters may be angry but if it works the Democrates will be the saviors. Obama could lead the charge and McCain would be forced to support or oppose; either one a bad option. I understand this plan seems farfetched but these are desparate times and it’s just an idea.
September 30, 2008 at 12:09 am
Blaming the outcome on Pelosi is absurd. Yes, maybe she shouldn’t have said what she said (though what she said wasn’t so terrible, since she mostly bashed Bush for a bit and said in passing that some Republicans supported him). But for anyone to change his or her vote over it? I thought Republicans were “country first” these days, which would have required those who were offended to denounce Pelosi’s comments and vote yes anyway. If they voted no because of them, then they’re children with no business being in Congress.
As for McCain, if he thought the financial crisis was important enough to “suspend” his campaign until there was a resolution, and there still isn’t a resolution, shouldn’t he re-suspend his campaign and go back to DC until there is a resolution? I mean, he was serious about this problem, right?
September 30, 2008 at 5:54 am
The Dems should just pass a free-market bailout, insurance not taxpayer funded.And quit listening to these scare tactics about not being able to use your credit card tomorrow. I disagree with the Repub. 99.9% of the time, but they got this one right.
September 30, 2008 at 10:42 am
Kosmas should watch herself. She is a realitor and she voted many times while she was in the State House for financial gain. She is now a Real Estate Millionaire as a result. I truly hope that she gets her tail kicked. I can never vote for a party hack.
I we want change in this country we need to take a stand and vote for the people and not the money. There is now t