A Run on Dubai

Back in the days before Federal Deposit Insurance, rumors could cause a panic that would send bank customers flocking to a bank and effectively causing it to collapse. You can see an example of that in the movie "It's a Wonderful Life".

Yesterday, while describing the panic that seems to have set in among Republicans regarding the Dubai Ports deal, Mort Kondracke on Special Report compared it to a bank panic, and I'm not sure he's wrong about that. Today, the Wall Street Journal editoralizes on the "Imperial" Congress and President Gulliver, and how panic seems to be sweeping the GOP:

Let's hope that the next time some Beltway potentate bemoans the "Imperial Presidency," everyone starts hooting with laughter. What we're watching this week is the Lilliputians on Capitol Hill tying down a Bush Administration that increasingly looks like Gulliver.

Over in the House, Republicans are preparing to block the Dubai port management investment as a political sacrifice to Democratic criticism. This even before the new 45-day review requested by the company is even two weeks old. Let's hope the world's investors conclude that this is a craven, one-time political surrender, rather than the start of an attempt to politicize every foreign investment in America that can be linked to "national security." If it's the latter, we're all in for some heavy economic weather, and Republicans won't believe how low their approval ratings can go.

Read the whole thing.