Monday, September 29, 2008

Damnation by Designation: the "Bailout"

What's in a name? A heck of a lot.

The rescue plan that was defeated today was damned from the start once it became known as a "bailout of Wall Street by taxpayers." Of course, we all hate that.

But that's about all that got through apparently. The dire consequences of not rescuing the financial industry was only a echo of the original ear-splitting blast.

Once the idea of a bailout of Wall Street became the way most people thought about it, proponents failed to make the point that the "bailout" was the means. The end was to save us all -- Wall Street and Main Street. In the glare of a"bailout" of the very financial geniuses of Wall Street who caused it (forgetting about all the greedy people who foolishly bought houses and cars, etc., etc. etc., and got themselves into unsustainable debt) the little glimmer of light that failure to do so would sink us all never got into the public mind, despite all the warnings from all sides.

My understanding from the economists I trust is that while the rescue plan was badly constructed and probably not the best way to accomplish the objective -- saving the financial system -- it was better than doing nothing and was the bill before us.

Once the serious consequences of a failure to get credit flowing again begins to hurt masses of people, maybe some constructive action will follow.

Now if only the politicians would stop trying to exploit the issue for partisan purposes, but, uh oh, I am dreaming again.

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