Why Not A Leveraged Bailout?

Today's imminent collapse of the secondary loan market and talk of a bailout reminds me of nothing so much as the early 90s when I cut my teeth on public policy in the midst of the savings and loan bailouts. My former boss Michael Waldman (later a POTUS speech writer) literally wrote the book on 'em. I remember his cynical coaching, "the corporate interests hate socialism when it's for the rest of, but love it when it's for them."

So true. One need look no further than the classic red-baiting consistently used to bring down any form of credible proposal for health care reform. How can it be that the same interests that come together through the Chamber of Commerce to bash government so consistently can expect the taxpayers to foot the bill for a multi-billion dollar bailout for their crushingly bad investment decisions?

Of course I oppose a bailout of these interests. Yes, I vaguely understand the ripple effect, the number of potential homeowners that might not get a loan without a "secondary market" to buy it up from their bank, etc. I grok. But I stubbornly believe, however naively, that banks will make loans if they are good business decisions and they won't if they aren't. I don't believe it does consumers any good to pull them into loans they can't afford and will default on. I don't believe propping up the over-inflated housing market is in the short or long-term interests of working people.

Although the Fed's aggressive action may have staved off a bailout for a time, I tend to believe a bailout is probably foreordained because the combined interests of wall street, campaign contributors and the perceived interests of consumers in getting more risky loans, will be enough to create a congressional majority, if not consensus, for taxpayer bailout of the sub prime market.

So given that virtual inevitability, I suggest we prevail upon the liberal Democrats to leverage something major out of the deal, something they've never mustered the will for before: a truce against government. If Capital gets to raid the Treasury, they agree to a moratorium on government bashing for say, the life of a typical home loan: 30 years.

This way, Congress takes out a 30 year mortgage from big business (and it has to be the whole friggin' chamber of commerce and its interlocking directorates that sign off on it, not just the lenders). The interest paid is this: the space for Congress to regulate for the good of the American people in an environment not poisoned by anti-government toxins.

Better yet, the Dems should push for big business to agree to front a major pro government campaign. Start disclosing on all their advertisements the government breaks that make it possible for them to exist and make money.

Picture this:

"It's never too late to refinance your home with Nations Bank--come in for a free consultation tomorrow. We can afford to loan you this money because of your tax dollars."

or

"The relationship between you and your doctor is treasured by Sutter Medical Group and the federal government."

Now that's a bailout.

Why do Californians like DiFi so much?

Today's California papers report on a field poll that shows we have soured on the new Congress. Democrats and decline-to-states are fed up with the failure of Speaker Pelosi and the new majority to even begin to get us out of Iraq. The poll shows plummeting approval ratings for the Congress. Yet, the same poll shows U.S. Senator Dianne Feinstein's approval rating only "dipping slightly."

This really fries my ass. I mean I'm as disappointed in Nancita as anybody, she and the House deserve the disapproval of Californians, but what is it about DiFi that keeps her pretty much inoculated from blame?

The conventional wisdom has always been that she hugs the middle of California public opinion. She's pro life, she's pro death, she's pro business, she's pro environment. But her consistent support for the war, for Bush's judicial appointees (not all, but most), and most recently for expanding Gonzales' wire-tapping authority, are appallingly out of step with the California mainstream. She was one of only 14 Democrats in the Senate to vote for this recent expanded authority--fourteen!

Yet Californians direct their rage only at the new petite liberal in charge of the House. Can anyone enlighten me?