Archive - Oct 2, 2008

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Like the momentous 2002 decision authorizing the invasion of Iraq, Congress' vote on a $700 billion financial industry bailout figures to reverberate unpredictably, both for the economy and for the politicians vowing to protect it.

The White House and congressional leaders already have made up their minds. Confronted with the defeat of an earlier measure in the House this week and increasingly urgent warnings of economic hardship, they've begun rounding up votes the old-fashioned way.

They're buying them.

A revised bailout bill includes tens of billions of dollars in tax breaks for the middle class, for homeowners who don't itemize their deductions, and for property owners in Alaska, Florida, Nevada, South Dakota, Texas, Washington and Wyoming. Add on the $3 billion funding dollop for rural school programs over the next five years. And another $8 billion over the same period in disaster aid, much of it for Midwestern states. And toss in unrelated legislation, far-reaching in its own right, requiring insurance plans to provide better benefits for mental health.

None of these has any direct bearing on the problem afflicting Wall Street and the entire economy. Yet in the currency of Congress, each is rapidly becoming part of the solution.

Yet if the vote on Iraq is any indication, the consequences will be more profound than even the lawmakers understood at the time.  read more »