The Opinion Blog

The dollar's ability to store value is near an end

For Doc and Daniel:

From the morning e-mail ... Charles Mills, who calls himself the Confederate Lawyer, argues that modern monetary policy has weakened the ability of money to store value, and that bailouts could finish the dollar off:

By Charles G. Mills

Ordinary people do not need an economist to tell them what the word "money" means. Baroness Thatcher described it quite succinctly as a medium of exchange and a storer of value. To the ordinary person, money is what you can spend now and something that you can still spend after it has been in the bank for a while.

You voted in the Republicans and look what happened

Ripped from the wires ... Bob Herbert lays out the consequences that ensued from the broad popular support the Republicans once enjoyed:

By BOB HERBERT

The lesson for Americans suffused with anxiety and dread over the crackup of the financial markets is that the way you vote matters, that there are real-world consequences when you go into a voting booth and cast that ballot.

For the nitwits who vote for the man or woman they'd most like to have over for dinner, or hang out at a barbecue with, I suggest you take a look at how well your 401(k) is doing, or how easy it will be to meet the mortgage this month, or whether the college fund you've been trying to build for your kids is as robust as you'd like it to be.

Sanford: Government 'solves' problems it helped create

From the morning e-mail ... Gov. Sanford finds the government's response to the financial crisis more worrisome than the crisis itself:

By Mark Sanford

I am worried for our country -- not so much because of the tumult in the financial markets but because of the federal government's response and its implications.

Brown's opponent: I would have voted no

From the afternoon e-mail ... Rep. Brown's Democratic opponent, Linda Ketner, says she supports a bailout of some sort but would have opposed the bill voted on by the House Monday:

Statement of Linda Ketner, Democratic Candidate, 1st Congressional District of SC

The failure of the House to pass the President’s bailout plan is a reflection of justifiable public outrage over a deal that would protect Wall Street without sufficient safeguards for the taxpayer, and no comprehensive plan for reform and accountability in our financial institutions. We absolutely cannot privatize all of Wall Street’s gains and socialize their losses.

Anyone wanna read the financial bailout compromise?

Friends: Below is a link to the text of the draft compromise financial bailout bill to which Congress tentatively agreed today. Warning: Unlike last weekend's original proposal at three pages, this puppy is 106 pages in length. I'm going to work through it as time allows to see if anything troubling (over and above the fact this is happening at all) leaps out. Comments from those who care to do the same would be most welcome. dc

Download bailoutbill_092908.pdf

Comments?

With credit, Hard Rock Park might have survived

Saturday's editorial explains the necessity of a federal boost for the credit markets using a local failure as an example:

Anyone who doubts the necessity of some kind of federal bailout for the financial system should focus on the main reason the Hard Rock Park collapsed into bankruptcy this week: The folks who made the largest-ever tourism investment in South Carolina had no access to credit.

McCain makes financial crisis all about him

Ripped from the wires ... Harold Meyerson decries John McCain's campaign suspension as a publicity stunt initiated in desperation:

By Harold Meyerson

Slipping in the polls? Concerned that Americans may be paying more attention to the declining economy -- and even supporting economic regulation again -- than to your own stellar leadership abilities?

What's a Republican presidential nominee to do?

Welcome to Progressive Corporatism II

Ripped from the wires ... David Brooks notes that the likely passage of the Paulson-Bernanke bailout plan will return control of the economy to the old-money Establishment:

By DAVID BROOKS

Once, there was a financial elite in this country. During the first two-thirds of the 20th century, middle-aged men with names like Mellon and McCloy led Wall Street firms, corporate boards and white-shoe law firms and occasionally emerged to serve in government.

Starting in the 1960s, that cohesive elite began to fall apart. Liberal interest groups took control of Democratic economic policy. Supply-side think tankers and Southern conservatives dominated the GOP.

DeMint: Here's a better way to stop markets slide

From the morning e-mail ... Sen. Jim DeMint, who has already voiced his distaste for a federal bailout of the markets, offers a "free market" alternative:

Today, U.S. Senator Jim DeMint (R-South Carolina) announced he will introduce legislation to allow indexing of capital gains for inflation, a proposal that would index capital gains taxes for inflation, helping stocks, homes, and commercial real estate investments and help reverse the slide in U.S. asset prices.

Bush to Congress: Approve bailout then butt out

Friends: The Bush administration formally proposed its massive financial-bailout program to to Congress today. The text of the plan is below. The good news: In Daniel's parlance, it isn't TL-DR, only three paper pages long. The bad news: If Congress approves it, it would have no further role in what happens with the markets, other than receiving quarterly reports. A little unnerving, no? dc

LEGISLATIVE PROPOSAL FOR TREASURY AUTHORITY

TO PURCHASE MORTGAGE-RELATED ASSETS

Section 1. Short Title.

This Act may be cited as ____________________.

Sec. 2. Purchases of Mortgage-Related Assets.