Posted on Sustainabilitank.info on September 29th, 2008
by Pincas Jawetz (PJ@SustainabiliTank.com)
Even though the bill grew from 3 pages to 110 pages, the Conservative Republicans wanted no part of it.
The bill was defeated 228 - 205 with 140 Democrats voting for it and 95 opposing. You can say thus that the Democrats stuck their neck out and were afraid to be seen as those that derailed the President and brought on a calamity - and a clear calamity is in the making indeed. Money runs away from the stock market and into US treasuries that give now next to no returns at all. So, investors look for a safe haven and really do not care about not making gains. The best deal is now a 3 months treasury bill - and some may even think of bars of gold in the attic. The European Central Banks have stopped selling gold.
So, McCain came to Washington to help the President but his party failed him. Speaker Nancy Pelosi, the Democrat Leader of the House of Representatives, in introducing the Bill, said the truth - it was the nearly eight years of Bush that destroyed the Clinton savings and caused the present situation - this made the Republicans so furious that they decided to bite their own hands and vote NO! That is what the Republicans want us to think now - as we said - they built a trap for the Democrats - A You Die if you-do-or if -you-don’t. The election for President is not the issue now - it is the election of the House members.
Those folks did not want to be accused of having agreed to the bailout and will now fight the Democrats on very skewed levels.
McCain has problems, and Palin is irrelevant to the process.
The President of the Ukraine got the lesson of his life - not everyday you can see a superpower in its nakedness.
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A vindicated Europe celebrates ‘civilised’ capitalism.
By Bertrand Benoit in Berlin and John Thornhill in Paris, The Financial Times, September 29 2008.
As Peer Steinbrück pondered recent events on Wall Street, Germany’s hard-nosed finance minister could not help indulging in a bit of futurology. “When we look back 10 years from now,” he told journalists on Thursday, “we will see 2008 as a fundamental rupture.” The US, he said, would lose its role as a “finance superpower”.
Yet while US commentators may have interpreted such remarks as heralding a statist renaissance in Europe, there are few signs yet that the old continent is turning its back on the free market.
Yes, there is anger in Berlin and Paris at Washington’s refusal - up until after the outbreak of the subprime crisis - to heed European calls for more regulated markets. The proposals Berlin had made during its presidency of the Group of Eight industrial nations last year “elicited mockery at best or were seen as a typical example of Germans’ penchant for over-regulation”, Mr Steinbrück said.
Crisis management alone would not rebuild the lost confidence, he added. “We must civilise financial markets, and not just through moral appeals against excess and speculation.”
***
In a speech in Toulon on Thursday, Nicolas Sarkozy, the French president, said the world would have to learn the lessons of the financial crisis and rethink the values and practices of globalisation. This would mean shifting the emphasis from speculation to entrepreneurship and restoring a proper balance between the market and the state.
“The market economy is a regulated market, a market that is at the service of development, at the service of society, at the service of all. It is not the law of the jungle,” he said, predicting the end of laisser faire capitalism.
***
Officials in Berlin point to calls by Gordon Brown, UK prime minister, to curb excessive bonuses as evidence that a new consensus is emerging in Europe that could bridge the old divide between Britain and the continent.
No doubt the Europeans will now find new vigour in defending those areas that remain untouched by liberalisation. Mr Steinbrück said the country’s three-pillar banking system, with state, co-operative and commercial banks, had proven more robust than its two-tier US counterpart.
The crisis also presents Europe with an opportunity to push for more international co-operation, as it has done before in areas ranging from international security to climate change. Mr Sarkozy has supported the expansion of the G8 to include big emerging economies such as China and India, as well as calling for reform of the International Monetary Fund. “We cannot continue to manage the economy of the 21st century with the instruments of the 20th century economy,” he said.
Yet it would be wrong to read such statements as precursors of a general retreat of liberalism on the continent. In his speech, Mr Sarkozy defended the essence of capitalism that had permitted the “extraordinary surge of western civilisation over the past seven centuries”. He also said it would be a “historic error” to return to the collectivism of the past that had been responsible for so many disasters. In Germany, the world’s largest exporter of goods, politicians are all too conscious of how much their country has benefited from trade liberalisation.
Meanwhile, the last thing Ms Merkel and Mr Steinbrück want is for the radical Left party, a coalition of defectors from the Social Democratic party and former East German Communists, to turn the crisis into ammunition for next year’s general election. In June, Ms Merkel told the FT she was worried that attempts to discredit free-market liberalism would play into the left’s hands.
As Mr Steinbrück put it before German legislators: “Neither calls for more state nor naive beliefs in market forces will help us in our task of shaping the economy in a way that will allow all to benefit from stable, crisis-free growth.”
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