More Conservative Voices on the Bailout

Although I tend to believe it's best of for the American economy that the bailout bill be passed, I think it's important to hear from key conservatives who are not supporting the legislation, such as Rep. Jeb Hensarling:

Congressman Jeb Hensarling (R-TX), Chairman of the House Republican Study Committee, today issued the following statement on the agreement reached by House and Senate negotiators on the Paulson plan, and his intentions on the final bill:

“My top responsibility as an elected official is to protect the families and people who trusted me to represent their interests in Washington. I do not take lightly the critical nature of the credit crisis that our capital markets face today and the grave situation that every American will face should our credit markets freeze and remain frozen. Inaction has never been an option, but the Paulson plan should have never been the only option.

“In my heart and in my mind, I believe that this plan is fraught with unintended consequences, would force generations of taxpayers to pick up the tab for Wall Street losses, and could permanently and fundamentally change the role of government in the American free enterprise system. Once the government socializes losses, it will soon socialize profits. If we lose our ability to fail, we will soon lose our ability to succeed. If we bail out risky behavior, we will soon see even riskier behavior.

“I also believe that this Congress, in a rushed effort to provide stability to a troubled credit market, did not adequately discuss or investigate potential alternatives that would have constituted a work out and not a bail out. Even at this moment, it still remains more important for Congress to do it right than to do it fast. I stand ready, as do many of my colleagues, to stay here for as many days as it takes to do this right.

“For the last week, House conservatives have fought to protect innocent taxpayers from an unprecedented government raid on their wallets to bail out Wall Street from their bad decisions and financial losses. Principled Republicans like Paul Ryan and Eric Cantor helped improve the legislation before us by adding increased taxpayer protections and additional Wall Street accountability. But mere improvement is not the test for support. The test is whether, after weighing both the good and the bad, you believe that the plan ultimately leads America in the right direction. Using that test, I cannot in good conscious support this legislation.”

For what it's worth, the Dow opened down 300 points today due to continued uncertainty as to the outcome of this bill and due to the Wachovia takeover by Citibank.

Former Republican member of Congress Vin Weber was asked what he'd do if he was still in Congress:

Conservatives are unhappy.

Over the last eight years they’ve seen an expansion of the size and scope of government under a Republican president, and now they’re being asked to vote for an unprecedented expansion of federal power to rescue the faltering financial system.

If I were back on Capitol Hill I’d be unhappy too.

But I’d definitely vote “yes” on the financial package.

I haven’t had a single conversation with anyone in the real economy that does not confirm the Paulsen/Bernanke warning that a failure to act now will precipitate a meltdown of our financial system that will, in all likelihood lead to a long and deep recession.

Simply put, it is that prospect that ought to worry conservatives most, because in tough times Washington expands exponentially.

The New Deal, which represented the major historic shift toward big government liberalism, came in response to unprecedented distress in the real world. Bankrupt farmers and small businesses and unemployed workers called for help and the government responded with massive assistance, and an entire new paradigm of government was born.

Imagine, just to play a mind game, if Herbert Hoover had engineered an intervention that had prevented the stock market collapse from turning into a full-scale depression. The whole course of history might have changed in a direction far more to the liking of conservatives.

A “yes” vote on the financial rescue package is a vote to intervene in the market precisely to prevent the collapse that could usher in the next vast expansion of government.

It’s not a pleasant choice, but it’s not a close call to my way of thinking.