Congress defeated the $700×10^9 bailout bill championed by George Bush. The media are portraying this as a disaster, quoting financial advisors saying that this is a "financial 9/11" and that boy oh boy are we screwed.
On the other hand, I have to admit on some levels I'm happy to see this. Why?
First of all, this isn't the financial 9/11. The financial 9/11 was when all the major banks said, "Guys? We're dead. Please bail us out so our execs can enjoy their golden parachutes without the guilt of a destroyed economy all around us." What did Congress do after 9/11? Well, too quickly they passed the PATRIOT bill, overwhelmingly voting "yes" because the American people were demanding that we Do Something... even though many (most?) of those voting "yes" on it hadn't had a chance to know what was in it, never mind think about the implications of it. And the PATRIOT bill was a huge step in dismantling a lot of the basic protections we have against living in a surveillance state.
When there is a crisis, there's always a push to pass legislation, to Do Something, right away. Sometimes we're lucky and what is done makes sense. More often, it's thrashing about in a "ZOMG" reaction. Sometimes, if they are prepared, those with an agenda can push across legislation that would never have been pushed across when calmer heads were able to prevail. This is what happened with the PATRIOT act. According to reports, there's an oppressive cyberregulation bill waiting in the wings for the "Internet 9/11" to provide the public sentiment that will allow that to push across.
Probably we need to do something fast to prevent our economy from very quickly imploding. But I'm very nervous about the fast response. I'd like to see us do something right. I'd like to see us recognize that just a bailout without a philosophical shift in the attitudes that led us to this mess would be a huge mistake. I'd like to see us recognize that we've done an experiment with deregulation of huge, gigantic companies, and for those who were in favor of such things (which included, at least at times, me) to recognize that, yeah, those ideas have now been shown to be wrong, and sticking to them in spite of the evidence is not rational.
We need more than a band-aid. Yeah, quick action may be needed to keep ourselves out of a horrible depression for the next few years. But we need to think about the next several years, the next few decades, or, heaven forbid, even the next century or two. What we really don't need is a knee-jerk reaction.. and I fear that that is exactly what the $700B bailout is.