The 7oo billion $ suggested by the President of the US and his Treasury Secretary has been rejected by Congress and as I predicted in an earlier blog, the conservative Republicans voted against the bailout on the ground that state intervention in the economy would be a betrayal of the very creed of Burkeian conservatism represented in the strand of Reaganomics.
There is no doubt that a bail out package will eventually be passed as the US economy cannot survive for long in the present state of crisis. The cascading effect of banks tumbling into burnout can only be averted if liquidity and confidence is injected into the financial system and Paulson's remedy is from an economic point of view just right. But then there is the political point of view always important in an election year: The chances of John Maccain that for msometime seemed bright have now dimmed and that is important.
The financial crisis is spreading misery across the US and homelessness has dramatically increased. Even wellheeled professionals have now started mothballing their possessions and have moved into parking lots with their children and in some cases even their pets. It is time to bailout those really affected by the crisis.