A Democratic Voice Speaks Against the Bailout

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Yesterday, I noted that despite very plausible arguments to the contrary, I still believe that genuine ideological opposition was the reason the bailout garnered so many no votes on the far right and far left of Congress. TNR grabbed an example of that ideological opposition on the left, and I want to reproduce it here. It’s from Lynn Woolsey, a liberal congresswoman from California:

“Where is the comprehensive economic stimulus package that will assist 95 percent of the taxpayers — a package that includes unemployment benefits, food stamps, infrastructure investment, and of course, foreclosure relief? Stability should come from the bottom up. We need an economic package that will allow those in foreclosure to pay their mortgages and stay in their homes, bringing value back to the mortgage-backed securities that are clogging the financial system. Why isn’t Wall Street paying for the mess they created? By reinstating a one quarter of 1 percent surcharge on stock trades, we could raise nearly $150 billion a year from those who have actually caused this mess and profited from it. Finally, question three: With only three months left of this current Administration, why are we willing to even make available $700 billion to them? President Bush and Secretary Paulson have been wrong from the start on just about everything. If you think they will be responsible with this money, think again.”

I should note that Woolsey’s arguments here are distinct from the arguments of economists who object to the bill on structural grounds. (David cites several.) Those economists believe that there are other mechanisms by which the financial crisis can be addressed that would work better and more fairly. Woolsey’s objection, fundamentally, is that not enough progressive goals are being crammed into the bill, at a time when those progressive goals are sorely needed and unlikely to encounter fierce opposition.

And her goals are hard to argue with. Unemployment benefits? Infrastructure investments? Foreclosure relief? These are things America needs. I’m not sure I would seriously delay the bailout in order to achieve them, and they could be addressed by the next president, who may well be a Democrat operating with large Democratic majorities in both houses of Congress. But if rank-and-file Republicans are going to hold the bill hostage to gain traction for their priorities, why shouldn’t rank-and-file Democrats?

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