Wednesday, October 1, 2008 0 comments ++[ CLICK TO COMMENT ]++

Bailout Bill Will Likely Pass... Democrats Betting The Futre On This

I think the bailout bill will pass. Several revisions were made from the one earlier in the week:

Top lawmakers said the Senate proposal, worked out after a day of behind the scenes maneuvering, would include tax breaks for businesses and alternative energy and higher government insurance for bank deposits.


My understanding is that they are adding around a $100 billion for small business tax breaks and for alternative energy. This should attract more Democrats, who tend to be heavily in favour of alternative energy (however it will probably anger a bunch of Republicans who tend to dislike subsidies for alternative energy.) The New York Times has an excellent graphic breaking down the Congress vote earlier in the week. You can see how a few more votes will be enough.

As for my opinion, I am in a camp similar to Paul Krugman. This is nowhere near being ideal, and I don't think it solves the core problem...but it's reasonable given the circumstances. Americans will pay a big price but it depends on the nature of the Treasury plan (purposely overpaying without equity stake will result in losses, but otherwise it won't be so bad.)

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