Before I begin, let me say from what I can tell, not having seen them myself, it appears the debates were pretty much a wash. That isn't really a surprise, as I doubted Obama would allow a debate which denied him the chance to use prepackaged answers. So I expected a partly-scripted, partly-impromptu McCain  versus a canned Obama, which should work out as a tie. So, I think, unless I come across any interesting quotes, I will probably be leaving the debates alone for now.

Now, on to my major topic, the bailout votes.

I have two questions. First of all, why is it a Republican problem? The mortgages in question were created under a policy pushed by the Clinton administration to make loans more "accessible" for the poor and minorities. And that policy was fought for years by Republicans and supported by Democrats, even when they were in the minority.

So, how did this become a "Bush problem", as Pelosi has labeled it? What does Bush have to do with Clinton era policies and Democrat intransigence?

Second, given all that, why is a Republican vote against this bailout a Republican problem? I thought that Republicans were against government spending and big government. So, refusing to throw good money after bad to resolve a problem created and perpetuated by Democrats seems a perfectly sound vote.

And finally, as McCain has been rather vocal in opposing bailouts, though he later wanted to work out "a solution" (which he did not specify), why is he suffering a loss of support due to a filed bailout? In fact, as the bailout deals began to collapse before he even arrived, how does it have anything to do with him at all?

Now, I know some conservatives fear that allowing the bad loans to become valueless will cause enough deflation to put us into a recession or depression, but I don't buy it. There are a lot of loans, but not all are going bad, and, as a fraction fo the money supply, they are not that large an amount. And, the bailout ignores the fact that we are eventually going to have to face that deflation, either through higher taxes, reduced spending, or explicit monetary inflation, and subsequent deflation. So, why not face it now? Why put it off? Isn't that postponing of collapse what always leads us to even worse depressions? We are so unwilling to face a small slowdown, we postpone until it grows into a major collapse. Better to have a small slowdown now.

In fact, as I see it, the worst aspect of this whole thing is not that there will be a small economic slowdown, but that it has become a political football, leading to the press building up the threat. If this had happened in 199, with the press covering for Clinton, it would ahve seen a small slump in the economy, no press coverage, and we would have recovered in a few months. But thanks to the politically motivate overhyping of this story, the people are panicking more than they need to. (On the plus side, it is a great time to buy incredibly undervalued stocks if you have some free money.)

The Republicans really need to make a few points. First, that this is a Clinton and Democrat failure. Second, that they are not in the pocket of Big Business, and so they aren't going to bail them out. (Not that I oppose business, but why not use this principled stand to destroy a left wing stereotype?) Third, that the people whoa re hurt are those who were greedy and either bought more house than they could afford, or invested in risky mortgages to make a killing, knowing the risks, so why should responsible Americans have to bail them out? And, finally, that if there is a deflation, it is something we have to face sooner or later, so, though it might hurt, we should do it now, because postponing it will only make it worse, and that inability to bite the bullet and make hard choices is what got us in this problem anyway.

Actually, there is one more argument, though I doubt anyone has the nerve to say it. While the Clinton administration and Democrats thought they were helping minorities and poor people by giving them easy credit, by short circuiting the approval process, they ended up doing the opposite. With the collapse of the subprime market, now even responsible individuals with low incomes can no longer get loans they could before Clinton tried to help. So all this talk of helping the poor with easy credit meant only that the irresponsible could get loans for a short time, with their irresponsibility now making it impossible for ANY poor people to get loans. So, in the end, their feel good rhetoric doesn't match the results.

But, as I said, no Republican has the nerve to point that out.