Walking an awkward tightrope on bailouts

WALKING AN AWKWARD TIGHTROPE ON BAILOUTS…. Josh Marshall noted the other day, “Everybody hates the bailouts — liberals, conservatives and everyone in between. So can anyone admit that they were amazingly successful and cost only a fraction of what people first thought?”

It was a rhetorical question, of course, but for Republicans, it’s awfully difficult to answer.

For all the conservative anti-bailout rhetoric, it’s proven easy for many to have a short memory. Two years ago, it was the Bush/Cheney administration that requested the bailout, which was then endorsed by the House Republican leaders (Boehner, Cantor, and Blunt), the Senate Republican leaders (McConnell and Kyl), the Republican presidential ticket (McCain and Palin), and assorted, high-profile conservative voices (Mitt Romney and Glenn Beck).

But that was in 2008. Now, the financial industry “bailout” is universally reviled, and the same Republican Party that shaped and endorsed the TARP bill would like American voters to forget all about the party’s role.

Brian Beutler notes today that the GOP finds itself in a political jam. Republicans backed the bailout, and need to defend their efforts to the electorate. But to do that, they’ll need to say the bailout worked, and that’s a message the electorate clearly doesn’t want to hear.

Perhaps the most fascinating political conundrum of the 2010 election is one faced by GOP senators, almost all of whom voted for TARP and supported some of the other bailouts in the thick of the financial crisis. The good news is that, for all their shortcomings, the bailouts did the trick, preventing a deeper economic crisis. The bad news is those bailouts are now considered political poison by the tea partying conservative base.

That puts Republicans in a strange position: unable to say the legislation failed, but at pains to distance themselves from their vote nonetheless.

Brian asked several GOP senators about their vote, and the only one willing to boast about being right was Sen. Judd Gregg (R-N.H.) — and he’s retiring.

It’s worth noting that Dems aren’t exactly feeling politically secure about this, either. The entire Republican establishment backed TARP, but so too did the Democratic leadership, including Barack Obama. Dems are in a slightly better position — Obama is collecting the money Bush spent, and Dems haven’t spend two years trying to exploit public anger over the bailout for political gain — but as Chris Hayes reminded me this morning, it’s not like Democratic candidates will be anxious to take a pro-bailout message to voters in November, either.

It leads to a bizarre campaign dynamic — candidates terrified of defending a tough call, made two years ago, that was almost certainly correct in hindsight. Democratic candidates will be bashing Republican incumbents for voting for TARP, while Republican candidates bash Dem incumbents for the same thing, and no one on either side willing to say, “But I was right!”