Second try a charm?

Well, the first attempt yesterday at bailing out Wall Street failed, largely because of the almost unanimous public opposition to it. Clearly the administration misjudged popular anger at Wall Street excesses, as they have misjudged so many other things in recent years. It supports my thesis that Washington political insiders, living in their own narrow, isolated and self-contained world, are pretty much out of touch with the average Americans they supposedly represent.

It doesn’t help that Secretary Paulson is himself from Wall Street and made over $600 million while CEO of Goldman Sachs. There is understandable popular suspicion that he is too Wall- Street-centric (to put it politely), or that he is out to help his buddies on Wall Street (to put it impolitely). As someone put it, it is like the fox guarding the chicken house complaining that he needs more chickens.

They will of course try again in a day or two. What will be interesting will be to see if they make any substantive changes to their basic approach of government intervention in the markets, or whether they just add a few toothless sops to give House members more political cover, and then strong-arm the votes.

I don’t think the administration yet understands that people are going to be furious at this bailout, whatever form it takes, if it seems that banks get whole again but the average person is still in economic distress.