This is a situation in which Congress cannot merely shrug its collective shoulders, throw up its hands in unison and say, “None of the above.”
It’s understandable that nearly 70 percent of the House Republicans and 40 percent of the Democrats voted against a $700 billion rescue package on Monday. The measure would have added thousands of dollars to the federal debt each American taxpayers carries, and in the process would seemingly wipe away the sins of corporate mischief without protecting the nation from further financial abuses.
But doing nothing is not an option for Congress. The consequences of such a response was quickly reflected on Wall Street, which plunged some 778 points immediately after the proposal was defeated in the House of Representatives.
This is not only about golden parachutes for business executives or redemption for wealthy Wall Street moguls. This is about the retirement plans for millions of hardworking American families, families who represent the majority of U.S. citizens who have struggled for decades to raise their children, pay for their education and along the way set aside something to carry them throughout their years of retirement. It is also about the economy of the rest of the world, which is as shaky as it has been in most of our lifetimes.
Mike Conaway, who represents this area in the House of Representatives, voted against the proposal on the grounds that it bails out companies for making bad business decisions, and that such a large governmental intervention would would do little to fix the problems that created the situation. He and others who opposed the plan have logical reasons. Among those opposing are several hundred economics professors, including three Nobel Laureates, who asked Congress not to rush to the rescue without a time of deliberation.
So, what’s next? Over the past several decades, Congress has loosened regulations to a point where such a meltdown was possible. Congress needs to act to restore temporary confidence in the economy and allow for reasonable financial activity. Then Congress needs to make long-term reforms to prevent this from happening again.
Lawmakers shouldn’t go home until the first task is accomplished. That plan won’t be perfect; it won’t please everyone. But the alternative is much, much worse.