Wednesday, September 24, 2008

Obama, McCain should come together on bailout

If the financial markets are in as deep a crisis as we’ve been led to believe (I am skeptical of this), and if it is imperative that the government quickly bailout failing firms (I am very, very skeptical of this) than it seems like there is one way to get it done: Barack Obama and John McCain should co-sponsor the bailout bill and present a unified front in getting a bill that they agree on passed by congress.

Is that a pipe-dream? Absolutely. But reading the speeches of the two candidates yesterday, there is hardly a dime of difference between them. Each candidate laid out a set of broad principles that any final bill should include. Below, I have included exact quotes from their speeches (one in red, and one in blue). Can you tell which is which?

On oversight:
I have suggested a bipartisan board to provide oversight for the rescue. We will not solve a problem caused by poor oversight with a plan that has no oversight.

We should set up an independent board that includes some of the most respected figures in our country, chosen by Democrats and Republicans, to provide oversight and accountability at every step of the way.

On responsibility to taxpayers:
There must be a path for taxpayers to recover the money that is put into this fund.

But regardless of how we structure the plan, if the government makes any kind of profit on this deal, we must give every penny back to the taxpayers who put up the money in the first place.

On executive compensation:
No Wall Street executives should profit from taxpayer dollars.

The plan must include protections to ensure that taxpayer dollars are not used to further reward the bad behavior of irresponsible CEOs on Wall Street.

On earmarks and add-ons:
It is completely unacceptable for any kind of earmarks to be included in this bill.

Let me be clear--we shouldn't include this stimulus package into this particular legislation...

OK. John McCain’s speech is in red and Barack Obama’s speech is in blue (obviously, do you think I’d try to trick you with the colors?).

There are really only a couple of differences in the principles they outlined. McCain specifically mentioned that the legislation should be written in public, not “behind closed doors.” I expect Obama would probably agree to that. Obama has suggested that any bailout also include “the authority to purchase mortgages directly instead of simply mortgage-backed securities.” McCain probably would not go for that, but that seems like a fairly minor sticking point.

Obama also has proposed an economic stimulus plan that McCain would probably oppose, but Obama agrees that any additional stimulus should not be tied to the bailout bill, which is consistent with McCain’s position that there be no earmarks or add-ons.

Obama and McCain ought to sit down together Friday morning before the debate with just their senatorial aides (not their campaign people) and hammer out the framework for a bill. They could announce it at a joint press conference before the debate.

Failing that, the two campaigns could come together and jointly announce that the candidates will not support any bill that does not include each of their shared principles and will urge their colleagues to reject any bill that does not reflect those principles.

Will any of that happen? Of course not. Obama’s recent spike in the polls is largely tied to the financial crisis. From a political strategy standpoint, taking the issue off the table could negate that advantage. Conversely, McCain’s campaign could be looking at a political windfall if an unpopular bailout is passed by the Democratic congress with little Republican support. It would allow him to tie the Democrats to Bush and solidify his self-proclaimed “maverick” persona.

But if we really are at the brink of financial ruin, Obama and McCain should take the opportunity to lead…together.
Afternoon Update: Wow. This is encouraging. Apparently I should call on the campaigns to do things more often:
At 8:30 this morning, Senator Obama called Senator McCain to ask him if he would join in issuing a joint statement outlining their shared principles and conditions for the Treasury proposal and urging Congress and the White House to act in a bipartisan manner to pass such a proposal. At 2:30 this afternoon, Senator McCain returned Senator Obama’s call and agreed to join him in issuing such a statement. The two campaigns are currently working together on the details.

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