Not buying the bailout: Gingrich stirs the pot

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News item: Former House Speaker Newt Gingrich (pictured) is urging fellow Republicans to slow down and ask tough questions about the proposed Paulson bailout, warning that implementing the bill ‘is going to be a mess’ and that ‘Congress has an obligation to protect the taxpayer.’ These were not throwaway remarks; Gingrich published a lengthy argument against the bailout at National Review online Sunday evening.

Also not buying it: Conservative columnist William Kristol, who wrote Sunday of the case for the bailout, ‘I’m not convinced.’

Much as I don’t want to turn this blog into a political blotter, the politics of the bailout bill are shifting rapidly and worth watching. If Republican leaders can’t deliver votes for the bailout, it turns into a purely Democratic bill, and Democrats have little reason at this point to let a lame-duck President tell them what should be in it. That means the bill is more likely to be expanded to include aid to homeowners and limits on executive compensation at banks, whether the president wants those provisions or not.

Analysis: The Paulson bailout is not a done deal. What appeared to be a slam dunk on Friday night no longer looks so certain. Every day that goes by makes it tougher to pass. Every hour brings new objections to the proposal, on numerous grounds; it is expensive, unprecedented, unfair to taxpayers and will generate new profits for the least popular businesses in America, banks and brokerages. Notice that neither presidential candidate yet supports it. Polls will likely show it to be unpopular. I’m also guessing calls and letters to members of Congress will be heavily against the bailout. (Click here to learn how to call or write your member of California delegation to Congress.)

Of course, the Dow lost 372 points today. Another day or two of selling like that could help make the White House case for action.

-- Peter Viles