So, the US economy and several notable international economies are in tatters. How does Bush plan to fix this? Here's a breakdown of the president's speech by ABC.
Starting off, Bush remarked that “Without immediate action by Congress, America could slip into a financial panic and a distressing scenario would unfold. Ultimately, our country could experience a long and painful recession. We must not let that happen”. Notice the key words: “panic”, “distressing” and “long and painful”. However, Bush also said that “We must not let this happen”,without elaborating. A critical question remains. The government is already trillions of dollars in debt and has bailed out Fannie & Freddie, Bear Sterns, Lehman Brothers, and AIG among others. Does it have sufficient capital to deal with other financial collapses before Bush leaves office, should there be one?
What is Bush's rationale for bailing out financial giants? “With the situation becoming more precarious by the day, I faced a choice: to step in with dramatic government action or to stand back and allow the irresponsible actions by some to undermine the financial security of all”. Here, Bush is saying that there are only a few corrupt bankers and that he can't stand back and allow banks to run out of money when ordinary, law-abiding citizens need money and banks don't have any money to lend because it has been stolen by crooks.
Here's the next big question. How did the two potential future presidents respond? They issued the following joint statement: “The plan that has been submitted to Congress by the Bush administration is flawed, but the effort to protect the American economy must not fail. This is a time to rise above politics for the good of the country. We cannot risk an economic catastrophe”. This sounds just like McCain's “never surrender” rhetoric that we've heard so many times. The key question for Obama and McCain is still “Can they put politics aside?”
