BAILOUT BOOSTERS BUCKLE UNDER BACKLASH…. In some ways, we’re seeing an example of one of the longest delayed reactions in modern politics. Congress and the Bush/Cheney White House approved the Troubled Asset Relief Program in October 2008 — about a month before a critical Election Day. To be sure, the vote was considered controversial at the time, but there was bipartisan support for the proposal, and there’s little evidence that the vote had a significant effect in key races.
It appears the statute of limitations hasn’t run out. Policymakers who weren’t punished for supporting the financial industry bailout before the last election are feeling the heat in advance of this election.
The vote in 2008 to bail out Wall Street was framed as the only way to avert an economic meltdown and relieve financial institutions of their most poisonous holdings. For many members of Congress, it turns out that the vote itself was toxic.
Nearly two years after Congress approved the Troubled Asset Relief Program, the Bush administration’s $700 billion program to rescue the banking system at a moment when it appeared close to collapse, lawmakers from both parties who backed it remain haunted by the vote.
Republicans for months predicted that a backlash against the Democrats’ big health care law would be the defining issue in this year’s Congressional campaigns. But the bipartisan TARP vote has become a more resonant issue in a year when anti-incumbent, anti-Washington sentiment is running strong.
Over the last couple of years, the bailout’s public popularity has done nothing but fall — a sentiment that spans practically every group and demographic — but the far-right and Tea Party crowd seems especially incensed. This one vote has already played a significant role in a variety of races this year, including Sen. Bob Bennett (R-Utah) losing at his party convention, Rep. Bob Inglis (R-S.C.) losing in a primary, and Sen. Kay Bailey Hutchison (R-Texas) losing in a gubernatorial primary.
It’s no doubt tempting for lawmakers who voted for TARP to defend their position by defending the policy — the bailout was effective in preventing a collapse of the financial industry; the program cost far less than expected; and the bailed out institutions are already paying the money back. Unfortunately for those politicians, no one wants to hear a defense of a universally reviled policy.
If I were a Republican candidate taking heat for this, I suppose the preferable tack would be to point to those who came to the same conclusion in October 2008 — the bailout was requested by a conservative Republican administration (George W. Bush and Dick Cheney); it was enthusiastically endorsed by the House Republican leadership (John Boehner, Eric Cantor, and Roy Blunt); it was enthusiastically endorsed by the Senate Republican leadership (Mitch McConnell and Jon Kyl); it was enthusiastically endorsed by the Republican presidential ticket (John McCain and Sarah Palin); and enjoyed the support of assorted, high-profile conservative voices (Mitt Romney and Glenn Beck).
For GOP candidates taking heat from the party’s right-wing base, it should count for something to say, “I took the same position on this as Sarah Palin and Glenn Beck,” right?