The winners and losers of the bailout vote

October 2nd, 2008 · No Comments

By: Glenn Thrush

How can you identify winners and losers in a week when the economy raced toward the abyss — and Congress publicly disintegrated at the very moment its wisdom and leadership were most needed?

It’s nearly impossible to know how history will judge the key players in the bailout saga, with so much uncertainty remaining about the plan’s fate in Congress or whether it will even work in salvaging the U.S. financial system.

Unanswered political questions abound. Will voters in battleground districts punish shaky incumbents for voting for the deeply unpopular plan? Are the pay-go proponents, the Blue Dog Democrats, in for payback if they approve new tax cuts without commensurate spending curbs? And what will happen to the liberals and members of the Congressional Black Caucus who oppose the plan if the economy heads into a more severe downturn? Will fiscal conservatives remain divided on the bailout?

With those caveats in mind, here’s the scorecard headed into the final, intensive 36 hours of debate over the bailout.

Winners

Sen. Ted Stevens (R-Alaska): The last become first during an upside-down week. Stevens’ federal trial on charges that he filed false Senate disclosures would have been the biggest news story in Washington this week, but the bailout fight spared him from the spotlight’s glare during his most challenging reelection campaign ever. The revelation that Stevens’ former pal and benefactor Bill Allen turned state’s evidence has hardly made a blip.

Rep. Charles B. Rangel (D-N.Y.): The same goes for the embattled House Ways and Means Committee chairman, whose failure to pay taxes and report income on rental properties has been overshadowed, for the moment, by much more consequential economic issues. He even had a seat at the table during Saturday’s negotiations over the bailout package. Once this is over, though, he still has to face the ethics committee.

Rep. Steven C. LaTourette (R-Ohio): Monday’s vote might have turned out differently if leaders had heeded the warning from this little-known Ohio congressman. During a House Financial Services Committee hearing last week with Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke, LaTourette identified the main threat to the rescue package: the failure to translate this deal for Joe Sixpack. LaTourette practically begged Paulson and Bernanke to explain the credit crisis to the "guy on the couch" in his district who is worried about losing his car, house and job. "In order to accept this plan, … he needs to be more scared," LaTourette said.

Reps. Darrell Issa (R-Calif.) and Brad Sherman (D-Calif.): The politics of economic cataclysm make the strangest bedfellows. Issa, one of the House’s more conservative members (known to some of his colleagues as "the king of lost causes"), worked in tandem with Sherman, one of the most liberal, to defeat leadership in both parties on the bailout. They were the Skeptics Caucus, and they helped kill the House bill Monday.

Losers

House Speaker Nancy Pelosi (D-Calif.): Wall Street and Main Street united in their collective contempt for the party leaders who brought the most consequential vote in recent congressional history to the floor — without assurance it could actually pass. Pelosi’s hard-edged partisan floor speech, sources say, was intended to assuage liberals who were balking at bailing out banks. But it also gave her GOP enemies an excuse — even if it was a spurious one — to bail on the plan.

A top Pelosi ally said that "she did her job by delivering 15 or 20 more votes than she promised," but her job was to count all the votes — and that meant knowing that the GOP leadership wouldn’t or couldn’t accurately estimate support in their caucus. Pelosi remains powerful and secure in her leadership post, but the defeat diminished the prestige of the House as a pivot point for solving a national crisis. At her worst moment on the House floor, Pelosi could be seen lobbying members of the Congressional Black Caucus, who rejected her pleas to switch their "no" votes.

House Minority Leader John A. Boehner (R-Ohio): Boehner described the bailout as a "crap sandwich" — a perfect description of the political week he endured. No politician in either party was more bloodied by the bailout loss than the already vulnerable Boehner, who failed to deliver half of his caucus, as Pelosi had demanded. History may ultimately smile on his actions — seeking to bridge the differences between free market conservatives and pro-bailout moderates — but he staked his reputation on victory, and failed. And a day of reckoning inside his deeply divided caucus looms.

House Deputy Minority Whip Eric Cantor (R-Va.): Things started off well for the canny 45-year-old, who injected himself into the middle of the bailout debate at the precise moment when Boehner seemed to be leaning toward cutting a quick deal with Democrats. Cantor led a cadre of next-generation conservatives (and potential party leaders) that included Reps. Paul Ryan of Wisconsin and Adam Putnam of Florida, pushing a private-market alternative to Paulson’s government-backed bailout.

Cantor won a big concession in negotiations, getting a GOP-backed mortgage insurance proposal into the final bill, and declared his support for the package. But then he blew it by rushing to the microphones moments after the vote to declare that Pelosi’s speech had sunk the bill, an assertion that has been dismissed by many of his fellow Republicans.

Rep. Spencer Bachus (R-Ala.): Originally designated as the point man for House Republicans in bipartisan talks, Bachus was replaced after he attended a press conference alongside Democrats, appearing to endorse a deal before party leaders had signed off. He was quickly replaced by Minority Whip Roy Blunt (R-Mo.).

To be determined

Sen. Charles Schumer (D-N.Y.): The veteran senator, whose close relationship with Wall Street has paid off for the Democratic Senatorial Campaign Committee, removed a major barrier to passage of the plan by suggesting the hard-to-swallow $700 billion bailout be broken into more palatable pieces. Paulson initially called Schumer’s plan to break the allocation into several tranches a "grave mistake." But after Republicans such as Tennessee Sen. Bob Corker and Kansas Sen. Sam Brownback jumped on board, Paulson agreed to a phase-in, albeit one that would virtually guarantee Treasury gets the whole $700 billion.

House Minority Whip Roy Blunt (R-Mo.): Two years after he lost the majority leader race to Boehner, Blunt was tapped by Boehner to represent House Republicans in negotiations with Democrats, the Senate and Paulson. The deal blew up on the House floor, and Blunt, who apparently overestimated GOP support by at least 10 votes, shares a significant part of the blame. But the unflappable Missouri Republican was among the first in his party to call for calm and a bipartisan effort to put Humpty Dumpty back together following the Dow’s 778-point plunge. "Roy was put in an awful position," said a person close to Blunt. "He did the best he could, but people are angry, and they’re going to take it out on all of us."

Will he be hailed as a great compromiser or booted from leadership as an appeaser? If this bill passes the House and he delivers Republican votes, Blunt will end up in the winner column here.

Sen. Bob Corker (R-Tenn.): Corker has gone from a "who’s he?" freshman to a media-savvy player in two weeks. Thanks to his spot on the Senate Banking Committee, Corker has been in on key meetings and gets mobbed by reporters each time he comes out of the chamber. And one Senate aide said Democrats actually asked Corker to get involved because they thought he sounded more like a moderate and less like a conservative ideologue when bailout discussions got hot and heavy.


Copyright © 2008 Capitol News Company, LLC | Distributed by Noofangle Media

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Copyright © 2008 Capitol News Company, LLC | Distributed by Noofangle Media