Economy

Motives for McCain's intervention strategy begin to emerge (updated)

by JS O’Brien

Yesterday, Senator John McCain announced that he was suspending his campaign to return to Washington to provide leadership in the effort to save the American economy from what George W. Bush says will be a “long and painful recession.”  By yesterday afternoon, Senate leadership had announced that they were very close to a bipartisan agreement on the Bush Administration’s plan to buy up bad debt, thereby freeing capital markets to continue to provide crucial lending to businesses and consumers; lending that many call “the life’s blood of the economy.”

Senator McCain, Senator Obama, President Bush, and congressional leaders met yesterday afternoon with the congressional leaders thinking they were near a deal.  By the end of the meeting, there was no deal, participants were visibly upset, and an attempt by Treasury Secretary Henry Paulson to convene an evening meeting failed, as the House minority leadership refused to send a negotiator.

This morning the outline of what happened yesterday is beginning to emerge. Members of the House minority leadership, and specifically House Minority Leader John Boehner of Ohio, are rebelling against the administration’s plan, apparently even in its original form.  Their alternative plan involves insuring bad loans and providing tax cuts to infuse the market with private-sector money.  According to the AP, there was “sudden momentum” behind the alternate plan, presumably when John McCain said he was returning to Washington and, in fact, the AP is reporting that a “Republican source” quoted John McCain as saying in the high-level meeting that “I support the principles that House Republicans are fighting for.”

The as-yet-incomplete picture suggests that McCain returned to Washington not to smooth the process, which was already near completion, but to support House Republicans in their revolt against the administration’s plan.

The implications of this turn of events are astonishing.

  1. Democrats accepted the administration’s baseline plan, presented by the leader of the Republican Party, negotiated changes in order to obtain the necessary cover of bi-partisan support, and then were blind-sided by rebel members of the president’s own party.
  2. The president must be very, very politically weak indeed if he can’t marshal his own party members to support his plan.
  3. John McCain may be using the public outcry at “rescuing” Wall Street to derail the process, calculating that, at worst, he can claim that he stopped the Democrats (and his own president, presumably) from giving taxpayer money away to those who don’t deserve it.  This would help distance him from the very unpopular president, improving his “maverick” status.
  4. In the process, he is supporting a plan that offers more tax cuts to investors, opening himself up to charges of further tax favoritism to those who don’t deserve it.
  5. McCain is also in mortal danger of being perceived, by the electorate, as a dangerous loose cannon (the flip side of the “maverick” coin) whose leadership style is more destructive than helpful.

The next few days will be fascinating, and undoubtedly maddening.  If the Democrats wanted to, they could probably drag the entire economy down by killing any deal, say it’s John McCain’s and his Republicans’ faults, and use the shield President Bush gave them, and their cooperation with him, to deflect criticism from themselves.  Presumably, if it’s managed right, the Democrats could trade something close to an economic depression to win the White House and take large majorities in both houses.

Will statesmanship win out?

Stay tuned.

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UPDATE: John McCain has announced that he will attend tonight’s debate, which means that this entire thing just gets stranger and stranger.  He parachutes in, making a big deal out of bringing parties together and bipartisanship, leadership, and the like, disrupting a process near completion.  Then, when everything is up in the air again and it seems that the deal won’t get done, he decides to leave and go to the debate.

What am I missing, here?  How is he going to sell this behavior to the American public?  Are they really too tuned out and/or stupid to see what just happened?  How can he claim to have provided leadership when he bails out and leaves with things still unsettled?

Is he just so brilliant that I don’t get it?  Or is he truly, truly deranged?

2 replies »

  1. “Will statesmanship win out?”

    It damned well better. Especially since the negotiated plan was worlds better than the original Bush/Paulson plan and entire solar systems better than the “new and improved” Boehner/Republican plan.

    I’ve noticed something recently, though, in how most Republicans tend to react to emergencies – they become Democrats. Or, at least, they do these days, after 7+ long years of really, really bad federal management.

  2. “Statesmanship”?

    You’re joking?

    Arrest them all. That would be statesmanship. Investigate the white house for treason, crimes against peace, torture. That would be statesmanship. Round up the Wall Street vultures who defrauded investors and who are attempting to defraud the nation. That would be statesmanship.

    Sometimes I think that only a military coup by some true statesmen could save this republic from complete destruction and fascism.