The bailout bill failed to pass the house. The Dow is collapsing. Wow.
UPDATE: Douthat: “If the defeat of the bailout is a victory for liberty, it’s a victory whose costs I’m not prepared to bear.”
UPDATE II: A sharp friend: “The government cried wolf too many times.”
Did Pelosi’s “partisan” speech really sway that many votes? I’m not sure if Republicans are petulant children or steadfast defenders of principle. There was a real case to be made against ramming through an irresponsibly-conceived bailout on such short notice, but Republicans, instead of offering a plausible alternative, voted against the legislation out of spite.
UPDATE IV: Perhaps the bailout isn’t as critical as we thought (emphasis mine):
“People are very seriously concerned that there’s no panacea from legislative action,” said Daniel Alpert, managing director of Westwood Capital, a New York-based investment bank.
“Fundamentally, none of the problems gets solved by the bailout. This may solve the freeze-up of the capital market but it doesn’t address the decline in housing prices,” Alpert said, adding that he expects to see more consolidation in the banking sector since there probably are many more mortgage-related writedowns still to come.
UPDATE V: Here’s the final vote tally.
UPDATE VI: Whatever happens, I found this piece from Daniel Larison oddly stirring:
It is easy to talk about principle when there is no crisis happening and no risk attached to standing on principle. The real test comes when holding fast may actually cost something. Holding to a principle, if it means anything, means that you value it more than mere self-interest, satisfaction or comfort. A lot of Americans want to have it all–the pretense that they are free, with none of the responsibilities or dangers that go with it. In reality, you can either have the latter and remain free, or you can cease being free and then be kept free (temporarily) from responsibility and danger.