By noon on Friday, it appeared that there was an agreement in place for the $700 billion bailout, however the only Republican mentioned in the agreement was Robert Bennett of Utah. There was not a single real Republican leader that was mentioned in this agreement. Then, the leadership of the Republican party one after another came out against the plan and they were members of the both the House and Senate. Most of the Republican leadership was against the fundamental principle of a bailout.
The Democrats were now set up to be married to Bush's bailout while the Republicans could present an alternative that forced Wall Street to hold onto these bad bonds. There was one other thing that worked for the dynamic for the Republicans. Since the Democrats are in the majority, they don't need them to pass the bailout. This is something that was missing from any of the Republicans' talking points. I was waiting for someone in the leadership to make it clear that if the Democrats want to pass this bailout, the Republicans won't stop them, but they won't support it either. Someone should have made it clear that if the time comes the Republicans wouldn't filibuster the bill.
Then, came the debate. At the very beginning, Barack Obama made an allusion about this $700 billion bailout and by doing so he implicitly endorsed it in principle. Then, came John McCain. Inexplicably, he said that he hoped to be able to vote for a bill as well. I was floored. The rest of the debate became inconsequential because his game changing moment had come and gone. Now, imagine if he had answered like this.
Jim, I came to Capitol Hill yesterday because I was concerned that Republican voices weren't being heard in the compromise. I have spoken with most of the Republican leadership and we are convinced that simply bailing out Wall Street and relieving them of their loans is a bad idea. We have several alternatives on the table including providing insurance and opening up the Fed's open window. Let me make two points clear. If the Democrats want a bi partisan bill, then it can't be a bailout. The other point is this. The Democrats don't need Republican support. We will not vote for a bailout but we also understand that the situation is dire and so we will not filibuster either if they bring it to the floor. If the Democrats, and Barack Obama, want to go along with the President and provide a bailout to Wall Street they can do that on their own. If they want to work together, they must entertain our non bailout pro growth ideas.
This would have put Barack Obama on the defensive. He had already implicitly supported the bailout. For the rest of that portion of the debate, he would have had to defend his position and constantly inch himself closer to Bush. It would have also made clear that the bailout was a Nancy Pelosi, Harry Reid, Chris Dodd, Barney Frank, and George Bush special. If they wanted to include Republicans, it would need to be something different than a bailout.
That should have continued to be the mantra of Republicans from Friday afternoon all the way through till this bill is passed. They will not stand in the way if the Democrats insist on a bailout, but they will not support it.
That would have put the Democrats siding with the President on the most important piece of legislation. That would have made the Democrats singularly responsible for passing a monstrocity that the public can't stand. If they wanted political cover, then they would have had to compromise. If they didn't compromise, then, their constant attacks attaching President Bush to Republicans and McCain specifically would have seemed silly. After months and years tying the Republicans to Bush, it would have been the Democrats tied to Bush. That would have been the political coup of the campaign. It would have been the game changer.
Instead, they are compromising, and it won't be a bill that will give their side anything of substance. It is a largely fruitless exercise for the Republican side, and yet they are going along with it. They had set up the Democrats brilliantly and yet, at the moment, that they finally needed to finish them off, it was as though they lost their nerve. This was a mind boggling missed opportunity.