This page doesn’t often quote the incumbent president in a favorable light, but, like a broken clock, George W. Bush is correct on occasion. When the president recently predicted that the economy—or, in Texas vernacular, “this sucker”—may go down without a bailout, he wasn’t kidding.
Nevertheless, dozens of irresponsible members of the House of Representatives banded together, left and right, Democrat and Republican, to defeat an admittedly complex but absolutely necessary plan put together by Treasury Secretary Henry Paulson. Among the dissidents, incredibly, were four New Yorkers, three of them Democrats. The Democrats were Kirsten Gillibrand of upstate New York, Maurice Hinchey of the Hudson Valley and Jose Serrano of the Bronx. The Republican was Randy Kuhl, who represents western New York. Presumably, each of these public servants is well aware that Wall Street is in New York. Presumably, they realize that by voting against this bill, they were voting against a measure designed to aid an industry vital to the prosperity of their home state. And yet they voted against it. What were these bozos thinking?
With those votes, they helped make a grave crisis even worse. In the tradition of Herbert Hoover, they looked catastrophe in the face and chose to do nothing. The credit crunch is certain to get worse, with devastating results for their constituents as well as for the rest of the nation. All Americans will pay the price, including retailers who rely on credit, prospective home sellers struggling to find buyers and, of course, every manufacturing and wholesale firm that depends on credit to finance its goods and inventory.
It’s time to hear more from New York’s formidable U.S. senators. Charles Schumer and Hillary Clinton certainly have not been idle, but their voices have not been heard often enough as Washington considers the fate of New York City’s most important industry, the financial sector. They need to put aside politics and rally around Secretary Paulson, a man who, unlike 99 percent of members of both houses of Congress, has an acute understanding of how the financial markets work, thanks to his time running Goldman Sachs.
Mr. Paulson had the unenviable task of putting together the package that the House so foolishly rejected on Monday. He did so under tremendous pressure, cobbling together a product that was not without flaws, but surely was better than any alternatives. That shouldn’t have surprised anybody: Mr. Paulson’s arrival at Treasury was greeted with praise and relief after he was appointed to the post by President Bush. There is no suggestion that somehow he became less competent in the intervening months.
How to explain, then, why four New York congressmen joined with more than 200 others in rejecting Mr. Paulson’s plan? Well, don’t ask them, because if you do, you’ll hear gibberish. The sad fact is that politicians simply don’t know what they’re talking about when they comment on high finance. They, of course, are entitled to their opinions, but voters should demand that their representatives hold informed opinions. There is no indication that the dissidents were informed by anything other than knee-jerk ideology and crass opportunism.
New York’s Congressional delegation ought to be working together in this nerve-racking time. Members of the House and our two U.S. senators ought to be focused, laserlike, on nothing else but the economic crisis. Their voices should be among the loudest on Capitol Hill.
This is a historic moment, for Washington, New York and the nation. If the next version of the bailout fails, we recommend readers begin stocking up on canned goods and bottled water.