So the U.S. Congress is taking its sweet time on the "Bailout" bill. Obviously members and staff have not read my last post: "The Economic Reality of Today's Uncertainty."
Yes, they should not give a blank check to Paulson. Yes, deliberation many times creates a better bill (it also amazingly creates opportunities for unneeded add-ons). But imagine what would have happened if two weeks ago Congressional leaders had said...,
"Mr. Paulson, we are the U.S. Congress. We take our sweet time deciding everything let alone a $700 billion request. What we will do is give you $100 billion immediately so you can try out your theory. In the meantime we will debate and deliberate the remaining requested dollars as to how we (the financial branch of our government) deem, based on your request, it best for our constituents and the country."
If Congress had authorized a quick, say, $100 billion immediately, the Treasury could have tested their theory, stabilized the market, immediately been able to see inside the motivations and dealings of these mortgage derivatives, and provided solid information for the deliberation that followed.
Wow, the decisiveness, the understanding of the market situation. A good deal of uncertainty might have been avoided as would have many a 401K. But alas it did not happen that way. While Congress may have forgotten how to work in a bi-partisan manner on important issues, time will tell whether the posturing we have seen this week will prove beneficial to us all.
Comments? Questions? Feedback?