Thursday, October 7, 2010

"Must Win" Dist. 17 Race Hinges On Bailout Resentment

Truth is, this election is no more a referendum on Obamaconomy than previous were on Bushbailout, but the contest between this southern Demo conservative and neo-con Bill Flores has been labeled by no less lofty of political pundits as "The Washington Post" as a "must win" for the Democratic Party.

Chet Edwards acknowledges that his vote for the bank bailout might cost him re-election to an 11th term.

In an extremely candid interview with “The Dallas Morning News” editorial board, the 17th District U.S. Representative said voter resentment about what pundits two years called “moral outrage” over coming to the assistance of fat cat bankers and Wall Street traders is a potent force standing in his way.

Nevertheless, he continues to say to this day, “...But it was the right thing to do.”

He's not alone in his estimation of the controversial Troubled Assets Relief Program, a scheme introduced in 2008 to acquire up to $700 billion in questionable assets from banks.

Many very conservative – in fact, right wing - financial experts, including writers for “The Wall Street Journal” and “Financial Times” think it's one of the best bargains the American taxpayer ever got.

When the TARP bailout died a peaceful death on Sunday, Oct. 3, Steven Ratner of “Financial Times” penned the opinion that “...Without exaggeration, this legislation did more to keep America's financial system - and therefore its economy – functioning.”

You can listen to the man who ran the program. He ought to know something about it.

Herb Allison, assistant secretary of the Treasury Department, told Bloomberg Financial News upon his resignation a few days ago that, “This is actually the cheapest of any of these programs anywhere...”

By anywhere, he means anywhere on the planet, including Japan, Ireland, France or Germany. It looks like we're all in this mess together. Most western trading nations have adopted similar programs.

Though the TARP program was authorized for up to $700 billion in bail-out funds, only 1/10 of that amount was ever invested in taxpayer funds, he said. “We'll actually end up making a profit.”

Of $380 billion ventured, $204 has already been repaid. The net expense, $50 billion, according to White House estimates.

While taxpayers are still on the hook for $154 billion, $30 billion has been received in interest, stock sales and dividends.

One extremely controversial aspect of the deal, the bail-out of Citigroup with its CEO bonuses and sky-high executive salaries, represented a $3 billion investment.” The U.S. Government will wind up showing a profit on that investment, as well, said Mr. Allison.

Why so unpopular?

“I think no one wanted to bail out banks,” he said, with a genuine grin.

Resentment is fueled by “bitter politics and financial illiteracy,” according to FT's Mr. Rattner.

In the midst of the furor that almost cost Arkansas' Senator Blanche Lincoln re-nomination by the Democratic Party, Mr. Edwards calmly holds his original position, saying “Our nation is slowly recovering from the most severe economic crisis since the Great Depression.”

As to his “tax and spend liberalism” and alleged loyalty to the Obama-Pelosi “agenda,” it appears that for the time, he's in favor of extending the tax cuts Congress bestowed upon the wealthiest earners in the early part of the decade, during the George W. Bush presidential administration.

“I believe the most responsible approach is to extend all the tax cuts for one year to protect jobs and economic growth while we await the recommendations from the bipartisan fiscal ommission on how to best address our nation's long-term fiscal situation.

“I strongly support making permanent the tax cuts for middle class families because it will benefit the vast majority of our district. However, I do not believe we can afford to permanently extend tax cuts above $250,000 because that would add an additional $700 billion to our national debt.”

Add to that his no votes on Cap And Trade, Health Care Reform and most other hot button issues the conservatives use to whip up resentment against Democrats, and a picture of a truly independent Congressman begins to emerge.

He's proven it for once and for all, the thing he told voters in the previous two elections, “I have more in common with George W. Bush than I do with my party's Congressional leadership.”

Tell me. I've heard him say it and I believe him.

Here is what then – U.S. Senator from Illinois Barack Hussein Obama had to say about TARP during floor debate.

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