Stonewalling the people

The nation’s economy stands on the brink of collapse – literally. Last week on Good Morning America, Sen. Chris Dodd said leaders were told “that we’re literally maybe days away from a complete meltdown of our financial system.” There is conflict over how best to prevent that collapse.

There seems to be a consensus among almost all involved (except, of course, for one presidential candidate) that something must be done. The $700 billion bailout package for the failing financial firms that is currently being deliberated in Congress is generally seen as an acceptable first step. Personally, I hate the idea of the government swooping in to save companies who are in trouble mainly because of bad management and greed. But it appears if that doesn’t happen, money will cease to exist, and we’ll all have to revert to hunting and gathering. Leaving American International Group and corporations of its ilk out to dry doesn’t seem like a viable option.

The thing that’s really bothersome, though, is that the American people are being largely overlooked in the quest to give the economy CPR. Thus far, the financial institutions going under have been the focus of most efforts. Democrats in Congress, though, have been pushing to have ordinary people included in the bailout as well.
Presidential candidate Barack Obama said Sunday that “Washington also has to recognize that economic recovery requires that we act, not just to address the crisis on Wall Street, but also the crisis on Main Street and around kitchen tables across America.”

Treasury Secretary Henry Paulson disagrees.

To answer the demands for help for the common person, he says that “the credit markets are still very fragile right now and frozen” and that “we need to deal with this and deal with it quickly.” The administration has claimed that the alternative to passing the bailout package as it stands is to allow the markets to remain frozen, which would effectively cripple the economy.

Based on this, it sounds like what Paulson is saying is that either the bailout package goes through as it stands or nothing gets through. I could be wrong, but it seems as if the only way the two scenarios are mutually exclusive is if the Bush administration is so dead-set on preventing bailouts for ordinary people that they would stonewall any provision developed with that as a part of it.

Essentially, the administration is using the urgency of this situation to try to pressure Congress into giving in, when in reality the two sides should be working together on a compromise between the two solutions. After all, it’s not crazy to say that regular people deserve some help too.

As Massachusetts Rep. Barney Frank said, “I don’t want the American taxpayer to get this bad debt and then the guy (whose company once held the bad loans) gets millions of dollars on his way out the door.”

There should be a middle road to take here, and the White House should engineer a compromise with Congress quickly. Because they’re right: Time is of the essence.