The bailout is back, but this time Congressional leaders, presidential candidates and White House mouthpieces are being careful to call it a "financial rescue plan," all the while adding provisions intended to mollify wealthier voters, corporations and other special interests.The House of Representatives, where all members must stand for re-election every two years, was spooked by voter anger at the $700 billion bailout and rejected it Monday on a 228-205 vote. But in the Senate, where members are elected on a rotating six-year basis, voter sentiment does not often penetrate the hallowed halls.
Financial interests, on the other hand, can always get a hearing.
And so it was that the Senate went to work Wednesday night, passing a revised bailout plan, one that temporarily hikes the FDIC insurance on individual bank deposit accounts to $250,000 and increases tax breaks for corporations and wealthy individuals.
Main Street aquiver?
Banking and financial service lobbyists pointed to the 778-point nosedive in the Dow Jones Industrial Average after the House vote as a sign of the dire consequences that await working men and women if Congress does not ante up.
But not everyone in Congress is heeding the call. Rep. Joe Barton (R-Texas), who voted against the bill in the House, said he has no plans to change his vote.
"Why would I turn around and vote for it?" he asked. "[It] is the same bill that I voted against two days ago."
Nevertheless, in Washington's time-honored vote-buying tradition, the bailout bill is rapidly acquiring more add-ons than Thomas Jefferson's Monticello, driving up its ultimate price while perhaps doing little to heighten its chances of saving the economy.
A tax-break package that's linked to the Senate version includes $17 billion in tax credits for the development of solar, wind and other forms of renewable energy. Another provision would spare 24 million middle- and high-income households from a $62 billion alternative-minimum tax that is due to take effect this year.
More angry than scared?
But Main Street may be more angry than scared. ConsumerAffairs.com readers took to the Web after Monday's vote (see below). Many said their savings were already depleted by job loss and healthcare expenses and that whether Wall Street recovered or not was not at the top of their list of priorities.
L. of Houston, TX wrote: "There is no way that I have any confidence in the current administration. There has been nothing but lies, corruption and greed since Bush was 'elected' president. It makes the Sopranos look like a troop of boy scouts. We do need some of the blue collar workers in charge."
Others, like Juanita of Virginia, jeered at the notion that low-income homeowners who fell behind on their mortgages were responsible for the credit crisis.
"Wow, the root cause is an eyeopener! Who knew, trying to help those "minority constituents with bad credit" purchase a home could almost bring down Wall Street. They must feel pretty powerful right now!" she said.
At almost the same time Juanita was posting her screed, a new study was being reported. It found that, just as Juanita said, homeowners who are struggling with mortgages for their own residences are a relatively small part of the overall mortgage crisis. Instead, it is speculators who have caused most of the losses the study found.
Brian and Gloria go to bat
Prior to Wednesday night's vote, supporters mounted an all-out publicity program to paint the bailout as being a lifeline to Main Street, claiming it is everyday voters who have the most to lose if their 401(k)'s and pension plans are driven into the doldrums by a recession.
On its evening news, NBC devoted a lengthy segment to the proposal. News reader Brian Williams noted that even General Electric, which owns NBC, was having to count its billions carefully and had sold a $3 billion stake to Omaha's Warren Buett.
"After hearing the news today that Warren Buffet is now a $3 billion investor in our parent company, GE -- following his $5 billion to Goldman Sachs -- does this not make him our 'central banker'?" Williams asked on the blog that carries his byline.
On CNN, commentator Gloria Borger opined that everyday taxpayers were "beginning to understand" the need for the bailout.
Of course, Gloria's understanding exceeds that of Main Street mortals. Her husband, Lance Morgan, is a publicist for Powell Tate, one of the many Washington "strategic communications" firms that grease the skids for corporate interests, a fact Borger and CNN seldom bother to disclose but one that is well-known to Powell Tate's clients.
"We draw on our strong relationships with journalists, publications, broadcast outlets, and online venues covering all areas of the financial services industry ... to help clients ... achieve their goals," Powell Tate's Website boasts.
But Brian and Gloria no longer hold quite the exclusive grip on public opinion that the monopolist media have long enjoyed. Thanks to the Internet, home-grown commentators like Ivan Fail are increasingly influential in shaping the public debate.
A retired corrections officer and truck driver, Fail writes blogs and op-ed pieces from his home in Sparta, Mo. In an op-ed published Monday by ConsumerAffairs.com, Fail called the original bailout package "a blistering indictment of greed driven 'behind closed doors' PAC money politics."
Gloria Borger's husband probably hasn't taken Fail to a lavish lunch yet, but perhaps he should. It might take more than few rib eyes, though.
"We have long been letting the the mortgage, finance and credit industry use their "see all, hear all and tell all," snoop and snitch credit bureaus invade our privacy and tell the world of credit and finance - and the rest of the world every time we're 5 minutes late on a payment, default on a loan. ... It's time that we 'turned the tables,' Fail wrote.
