Analysis: Democrats Could Have Passed Bailout
By Mark Impomeni
Sep 29th 2008 10:00PM
Filed Under:eHouse, Democrats, Republicans, Featured Stories, Economy


Now that the financial markets bailout plan has failed to pass the House, at least for the time being, both sides are settling down to place blame for the failure. Democrats were quick to blame House Republicans for not bringing enough of their members along to vote for the bill. Republicans counter that as the majority party, Democrats can pass any bill they want without even a single Republican vote. So who is right? The time line of the negotiations favors the Republican version of events.

Early last week, House Speaker Nancy Pelosi (D-CA) made it clear that there would be no bailout bill brought to the floor unless Republicans could bring along significant support from their minority caucus. Sen. Majority Leader Harry Reid (D-NV) openly called on the White House to guarantee the support of Republican presidential nominee Sen. John McCain, calling it crucial to final passage of a bill. Reid later changed his mind after Sen. McCain dramatically announced that he was suspending his campaign to come to Washington for the negotiations, saying McCain's presence, "would not be helpful."

Before Sen. McCain could arrive in Washington, however, Democrats announced that they had reached a deal on a bailout package. The House GOP objected, saying it was not a party to any agreement. The lead Republican negotiator at the talks, Rep. Spencer Bachus (R-AL) said that he had not been authorized to agree on behalf of the House GOP, and Minority Leader John Boehner (R-OH) confirmed that Republicans were not part of any deal that Democrats may have made amongst themselves. Republicans, frozen out of serious participation in the Democrats' negotiations, began drafting an alternative proposal to present at the White House meeting called for last Friday.

But Democrats got wind of the Republicans ideas, thanks to allies inside the Obama campaign and the Treasury Department, and turned the White House meeting into a partisan shouting match. Democrats allowed Sen. Obama to run their side of the meeting, after criticizing Sen. McCain for allegedly injecting partisan politics into the negotiations by coming to Washington. Sen. Obama proceeded to attack the Republicans in attendance over their alternative plan, using Secretary Paulson's own notes of concerns with the proposal, and any hope of a substantive, bi-partisan negotiation was scuttled.

Eventually, Republicans were included in the negotiations, after an embarrassing oversight in which Democrats held a bi-partisan meeting on the bailout plan, but forgot to invite House Republicans. Once Republicans were brought on board, the bailout package was amended significantly to suit their principles. For example, funding for the notorious community organizing organization, ACORN, which Democrats had included in their version, was stripped out. Also removed were provisions that would have benefited unions and trial lawyers, both key Democratic constituencies. And central pieces of the Republican alternative were added, including an insurance provision and a tax break for community banks. The deal was sealed with the promise of a vote on Monday.

But neither party's caucus was happy with the final result. Many Republicans saw the bill as a bridge too far, citing overwhelming public opposition to the bailout, while some Democrats thought that the bailout was skewed too much toward business interests at the expense of distressed borrowers. Democrats knew that Republicans would not be able to bring a majority of their caucus to vote for the bill, so if a bill was going to pass, it was imperative that as many Democrats as possible vote for the plan. However, one prominent Democrat has come out in the wake of the bill's failure to say that Democrats never made a serious effort to get their members on board with the legislation. Rep. Peter DeFazio (D-OR), himself a no vote on the bill, told (audio) National Public Radio that the Democrats did not cajole their members to support the bailout.

"Well, they were stunned. I was stunned. I thought the fix was in. You know, they got a lot fewer Republican votes than they wanted. And, a substantial number of us on the Democratic side took them at their word from earlier in the week, which is they weren't twisting your arms and to vote your conscience, and the conscience of a significant number of Democrats was this wasn't the right thing to do.
DeFazio's account is confirmed by the Democrat House Whip, Rep. Jim Clyburn (D-SC), whose job it is to count Democratic votes. He told Politico that as of yesterday, he had not received instructions from the Democratic leadership to bring Democrats along for the bailout. "The speaker hasn't told me yet. I do what I'm told," he said. All of this leads to the inescapable conclusion that Democrats knew or should have known that the bill was not going to pass today. That they chose to bring the vote anyway, without securing the votes for passage, casts doubt on their desire to see the bill passed to begin with.

Democrats control the House. Unlike in the Senate, the minority has almost no say in determining how legislation is drafted and presented, or whether it passes. For Democrats to now try and blame Republicans for not bringing enough votes to pass the bailout is the political equivalent of the Fire Department blaming the neighbors for not bringing enough buckets to put out the fire after the house has burned down. After shutting out Republicans at every possible opportunity during the course of the negotiations, seeking to fix blame on them for the failure of the result of those negotiations is cynical in the extreme. Republican help in passing the bailout may have been appreciated for the political cover it would have provided Democrats, but it certainly was not necessary. Democrats had enough water to put out the fire all along. They just chose not to use it properly.Comments [155] PermalinkShare:EmailLinkedBlogsRelated Articles

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