Crime & Federalism

Unable to explain why the bailout will work, Republicans and Democrats have decided to lie about the bailout:

WASHINGTON (AP) -- The Bush administration is searching for a new way to sell its financial rescue plan after acknowledging some blunders and missteps in presenting it the first time around. One big key: Insist it's not a Wall Street "bailout."

Now it's not about financial institutions. The focus has switched to everyday Americans. And it's not an expenditure of taxpayer money, it's an "investment."

This was clearly evident in Bush's grim warnings on Tuesday of "economic hardship for millions" if the plan can't be revived. He declared, "For the financial security of every American, Congress must act."

This emphasis was echoed on the presidential campaign trail.

"Let's not call it a bailout. Let's call it a rescue," said Republican John McCain.

Democratic rival Barack Obama said, "This is no longer just a Wall Street crisis -- it's an American crisis, and it's the American economy that needs this rescue plan."

House Speaker Nancy Pelosi's take: Its not a bailout but "a buy in, so that we can turn our economy around."

Imagine your child runs up a huge credit card bill.  If you pay his bill, have you bailed him out, or invested in yourself?  I imagine you could say that you're investing in him, since having unpaid credit card balances on his credit report will prevent him from getting credit.  But, really, how is that going to lead to a payout for you? 

Maybe he won't come home looking for another bailout?  But what assurances do you have?  If anything, most parents would say that bailing your child out is the worst thing you could do; since your child will always come back for more.

The Paluson-Pelosi-Bush Plan is a bailout, not an investment.  The bailout might still be needed.  Let's  be honest, though, and stop calling it an investment.