Yesterday I noted that some conservatives are urging Republicans to oppose the Paulson Plan while hoping that Democrats provide the votes to actually enact it. But there’s a Democratic backlash a-building as well.
The blogospheric Left is increasingly committed to full-scale opposition, viz. this post from Atrios:
Look, right now the choice is, Bush’s Plan, or Something Else. Kill Bush’s Plan now, worry about Something Else later.
Democrats, in general, and Senator Barack Obama, in particular – as the new head of the Democratic Party – should trash this outrageous dictatorial bailout and stop listening to the advice of those who led us into this mess – including some fellow Democrats of prominence. They shouldn’t tinker on the edges of the administration’s proposal. Their substitute plan should put the pain on the pin-striped grifters where it belongs instead of on those Americans who have been repeatedly victimized by them.
There’s also a lot of talk analogizing the political psychology of the bailout plan, and the choices it presents to Democrats, to the Iraq War Resolution and/or FISA.
But heartburn about the Paulson Plan is not limited to the blogospheric Left. Here’s Will Marshall of the Progressive Policy Institute in an op-ed today:
Rather than be stampeded into hasty action, Congress ought to deliberate long enough to make sure that Main Street doesn’t pay for Wall Street’s sins.
Marshall also links to his (and my) former colleague Rob Shapiro’s remarks on Marketplace yesterday, pointing out that the cost of the bailout would have a devastating effect on the policy options available to the next president.
While Democratic resistance to quick approval of the Paulson Plan is growing, there’s considerable confusion in terms of Democratic strategy. Virtually everyone supports Rep. Barney Frank’s efforts to secure substantive changes in the legislation; Paulson has already accepted a couple of key changes, including mortgage foreclosure relief and equity acquisition in bailed out institutions (this latter point being critical to potentially reducing the ultimate net cost to taxpayers). But such changes could also undermine Republican support for the plan, pinning Democrats with responsibility for enacting it, and raising the obvious questions as to why Dems don’t just craft a plan to their own liking and present Paulson and Bush with a take-it-or-leave-it proposition.
In any event, Democrats don’t appear to be just rolling over in a panicked reaction to last week’s market disaster, and letting a Wall Street guy toss three-quarters-of-a-trillion dollars at his old friends, along with foreign investors, with virtually no strings. We’ll soon know just how tough they are willing to be in what will be an extremely momentous series of decisions that could not only affect the November 4 elections, but what happens afterwards for years to come.