Bailout Fails To Pass House; Markets Panic

In an unexpected move, the House has killed the bailout bill. Lawmakers on both sides are pointing fingers, and the narrow failure of 228 to 205 came as a shock to the stock market. As of this writing, the Dow is down more than 700 points, and the House is staying in session to desperately attempt to hammer out a new proposal. 

So what's next? The Democrats have the majorities needed to pass a bill, but they won't. They do not want to pass a bill without Republican support, in case the bill fails to rescue the system. This is because when the political backfire comes, they do not want to shoulder the blame all by themselves.

What is going to happen, is for the first time since the Republicans lost control of congress, they have the opportunity to set the agenda. The Republicans have an alternate proposal-the only alternate proposal-to rescue the economy. Their proposal, is to insure the companies, and provide them loans, not a bailout. 

Their theory is this will be able to protect the taxpayers, and will achieve the same result as the bailout. If the Democrats want a bi-partisan bill, then they have to go with the Republican alternative.

Republicans will deliver this alternative, and will most likely get the votes to pass it. Republicans will be able to get all the credit for the bill, and distance themselves from president Bush and his proposal all at the same time. 

The financial crisis could be an opportunity for the Republicans to get back on the good side of the American voter. All they need to do is present their plan, and explain to the taxpayer why they as Republicans, have their best interest in mind. 

 

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Or the messiah saves the day

The democrats and *bad word* Barney Franks are already pointing fingers at the 'unpatriotic' republicans who refused to vote because 'Nancy hurt their feelings'

If this meme remains intact, the GOP suffers, especially if the markets dont stabalize.

I suspect Obama will ride to the rescue and deliver the remaing democratic votes they need to pass the bill, which after a few days of chaos will be embraced by the public.

This could be bad for us.

I would not expect it..

 Obama has been on the sidelines. Remember his call me if you need me, I'll be there in a hurry approach? I do not think Obama wants to inject himself into the politics, at least not while it is in the House. Remember, the House does not reconvene until Thursday, so there is plenty of time for the markets to throw a fit and prompt action. The market is up 200 points right now though, and lawmakers are not going to hurry this through. Expect on Thursday, for the House to make revisions, and perhaps vote on the measure again as soon as Sauturday.