A good explanation of how the country got into this financial mess...

...came recently from George F. Will:

"...a timeless political trope is: Government should budget the way households supposedly do, conforming outlays to income. But the crisis came partly because so many households decided that it would be jolly fun to budget the way government does, hitching outlays to appetites.
Beneath Americans' perfunctory disapproval of government deficits lurks an inconvenient truth: They enjoy deficits, by which they are charged less than a dollar for a dollar's worth of government. Conservatives participate in this, even though deficits fuel government's growth by obscuring its cost. The people can emulate the government because credit has been democratized. Democratization of everything is supposedly an unquestionable good, but a blizzard of credit cards (1.5 billion of them, nine per cardholder), subsidized loans and cheap money has separated the pleasure of purchasing from the pain of paying. Furthermore, the entitlement mentality fostered by the welfare state includes a felt entitlement to a standard of living untethered from savings."

Bingo. Read the whole thing--Will has been very, very critical of Republicans in congress for the past several years (and often rightly so--the GOP in Congress became far too willing to be free spenders). But here he's very sympathetic to the majority of Republicans' rejection of the first bailout bill. That vote may go down in history as a good one for the GOP (one of the few they've had recently).

And by the way, maybe Americans are starting to wise up--a recent poll shows that, by over a 20 point margin, Americans strongly oppose the bailout plan eventually passed.

Don't lose your heads...

So, today, a lot of people are angry about the failure of the bailout proposal to pass on Monday, and they complain about a lack of leadership...

But as we see here, negotiations on a new package will resume later this week; and I can't imagine legislators going home without some kind of deal being done.

As I said yesterday, this can lead to a better bill. And isn't that what we all want?
Steady as she goes...

The bailout package fails to pass the House

It will come up again very soon, of course; but it failed on it's first try--and I applaud those conservative members of the House who voted against it on principle:

"Early in the House debate, Jeb Hensarling, Republican of Texas, said he intended to vote against the package, which he said would put the nation on “the slippery slope to socialism.” He said that he was afraid that it ultimately would not work, leaving the taxpayers responsible for “the mother of all debt.” Another Texas Republican, John Culberson, spoke scathingly about the unbridled power he said the bill would hand over to the Treasury secretary, Henry M. Paulson Jr., whom he called “King Henry.”

I predict this defeat may be a good thing. The measure can be reconsidered, there can be further negotiations, and it can thus be improved. And conservatives in any case should never be happy with legislation that was, let's face it, rushed into, with some members of both parties hoping it would be passed with a whoop and a holler. That's not how good bills come about.

UPDATE: Ramesh Ponnuru over at NRO, for whom I have much respect, says this outcome hurts McCain.

I have to disagree. This is not a popular bill; I don't sense any kind of public support moving behind it. It seems rushed, hurried. What credit would there be for a bad bill? It's failure today doesn't mean we're at the end of anything. There's still time to improve the bill, and pass a better version; and Senator McCain should try to be at the forefront of such an effort. Besides, over 90 Democrats in the House voted against the bill; so it's failure simply can't be laid at the feet of the GOP, not with there being a Democrat majority there.

Big government conservatism?

So President Bush is asking for a $700 billion federal government bailout of our financial institutions, and when it comes to what this means for conservatism, I think Newt Gingrich is right:

"I believe that the president is exhausted and the vice president has been marginalized, and what you now have is the Washington interests . . . dominating the administration," former House speaker Newt Gingrich (R-Ga.) said in an interview yesterday. "We have now launched big-government Republicanism. If we saw France do this, Italy do this, we would have thought it was crazy. We would have had pious speeches about the folly of bureaucrats running businesses."

We as conservatives have to do a lot more thinking about how we begin to break this cycle of ever-expanding government.