David Leonhardt of the New York Times has an explanation of the financial crisis and the reaction to the bailout bill in Washington that is so clear, one wonders why it took a week for someone to write one.
Could the current crisis lift — could banks decide they really are missing out on profitable investing opportunities — without a $700 billion government fund to relieve Wall Street of its scariest holdings? Sure. And is Congress right to fight for a workable program that’s as inexpensive and as tough on Wall Street as possible? Absolutely.
But in the end, this really isn’t about Wall Street. It’s about reducing the risk that something really bad happens. It’s about limiting the damage from the past decade’s financial excesses. Unfortunately, there is no way to accomplish that without also extending a helping hand to Wall Street. That is where our credit markets are, and we need them to start working again.
The fear and anger that led to people jamming the phone lines of Congress (and crashing its Web site) is certainly understandable. But it also lacks a logical alternative unless one believes the economic forces that affect our wallets don’t really exist.
As for the politics of it all, Dan Balz in the Washington Post cuts through the talk show chatter with a scalpel.
The voters will sort out the blame on all this in November. Anger at Washington will feed a hunger for change, and it’s likely to fall harder on the GOP as the party that holds the White House. But for the next president and the next Congress, whatever its makeup, Monday’s performance should be looked at as an example of what it was, a performance designed to undermine the public’s confidence in its elected leadership.
Update 8:41 a.m. Let’s add Thomas Friedman to the mix, even if it’s just because of this paragraph:
I’ve always believed that America’s government was a unique political system — one designed by geniuses so that it could be run by idiots. I was wrong. No system can be smart enough to survive this level of incompetence and recklessness by the people charged to run it.