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The news this morning is that there's been a compromise on the infamous American bailout that will be voted on over the next couple of days. Details are currently very, very long (110 page in the current draft), and I haven't yet read anything more than a summary,  but I don't think anyone off Wall Street can be more than grudgingly happy with it, increased oversight and all. This is far from my area of expertise, mind, and the ever-excellent Hilzoy has a good point in saying that weighing this plan on its merits will be tricky even for the experts.  At least it took a step towards not completely fleecing the taxpayers by demanding equity warrants/debt instruments from companies they fund significantly (however, note that it's not specified what degree of equity should be demanded, settling only on "reasonable") - that's the only reason I can avoid cringing when I think of this passing.

EDIT: taking a quick glance at the draft before I have to go to class, it seems to retain the "revolving door" functionality I note here, even though the size of that door has been cut in half (pending a presidential declaration that can be countered by a joint Congressional resolution. This would seem, given the unknown amount of securities at issue, to be a necessary evil, but it should be noted once again that "$700 billion" is a misnomer - it would be entirely plausible to spend much more than this in the end.

On the other hand, it's worth noting that people like Bush and Paulson at the treasury department, that would really have preferred the original plan will be in charge of implementing the new one, and will have most of the rest of the year to do so (since Congress is going to adjourn for the election and won't be back to oversee anything or read any reports from Treasury until late November at the earliest -more likely January), and that the bill seems to give them a lot of leeway to ignore its more onerous portions (assuming this leaked conference call from a securities industry group is legit - I found it on a forum, so I make no promises-it's edifying in that regard).

Analogies are dangerous beasts (in fact, there's footage of wild analogies hunting on a literary savannah on the sixth disc of Planet Earth that has to be seen to be believed), but it boggles my mind that Sweden's answer to a similar financial crisis wasn't higher up in the minds of those pulling the levers in Washington and New York this weekend (especially since the AIG bailout two weeks ago proceeded largely along those lines). But Paul Krugman is likely right that this wasn't politically feasible, given the trouble even the current plan is going to run into on Capitol Hill, especially in the House.

The conservatives in the House are up in arms because the bill represents creeping socialism, leftists like Kucinich are angry because it's too much money going to the wrong set of "people that are responsible for the problem" (all the "helpful to homeowners or at least not overly generous to the financial industry" provisions that actually had any teeth got cut out over the weekend, leaving a pile of suggestions and criteria for consideration in their place), and all 435 of them are facing an election in a month (and desperate to go home so they can campaign) with constituents that seem quite angry with what's been settled on.  Pelosi and Boehner are going to have a hell of a time finding the votes they need, and I would be far from surprised (or angry) if this failed the House vote today.

On one hand, potential economic apocalypse. On the other, crippling expense for the federal purse (which could cause problem 1 in the long term anyway) and re-election challenges against opponents that can beat you over the head with the populist stick of their choice from now until November. Who knew that the constant selfishness of Congresspeople could have tolerable consequences once in a while?

This may be an emergency necessitating such precipitous action (my personal amateur jury is still out on that), but it remains a case in which a bad plan is definitely worse than no plan at all.