McCain may have gained traction among social conservatives by
naming Sarah Palin as his running mate, but his emotional and
irrational reaction to the crisis on Wall Street risks alienating
economic conservatives, and, as far as I’m concerned, it renews
questions about whether he has the temperament to be an effective
president.
His reaction to this week’s news has thus far been to huff and
puff about greed on Wall Street, call for a commission to study the
problem (very legislator-like), and to make vague promises about
tough and aggressive regulation.
At a speech in Cedar Rapids today, McCain began to offer more
details, which included firing SEC Chairman Chris Cox, as Quin
mentioned.
I just got off of a call featuring Doug Holtz-Eakin, McCain’s
economic policy adviser, who was asked several times what Cox
specifically did wrong that would warrant his firing and what it
would accomplish to fire him in the middle of a crisis.
Holtz-Eakin couldn’t give a specific answer — he just kept
repeating that Cox (who he did not mention by name) had a “track
record that did not meet the standards that John McCain felt
appropriate.”
Also, he was asked if it mattered that McCain, as president,
didn’t have the authority to fire a sitting SEC commissioner.
Holz-Eakin said McCain would publicly ask him to resign, and thus
intimidate him into doing so.
In other words, in seeking to be the anti-Bush (see: “Brownie,
you’re doing a heck of a job”) McCain would move to the other
extreme, so that in his administration, anything bad that happens
will lead him to scapegoat officials, even if McCain can’t point to
any specific wrongdoing, and even if it wouldn’t do anything to
help solve any of the underlying problems.
Also today, McCain’s called for a new government agency to deal
with the mortgage crisis, which he described thusly:
We cannot wait any longer for more failures in our
financial system. Structures like the resolution trust corporation
that dealt with the failed savings and loan industry were designed
to clean up the system and worked. Today we need a plan that
doesn’t wait until the system fails. I am calling for the creation
of the mortgage and financial institutions trust - the MFI. The
priorities of this trust will be to work with the private sector
and regulators to identify institutions that are weak and take
remedies to strengthen them before they become insolvent. For
troubled institutions this will provide an orderly process through
which to identify bad loans and eventually sell them. This will get
the treasury and other financial regulatory authorities in a
proactive position instead of reacting in a crisis mode to one
situation after the other. The MFI will enhance investor and market
confidence, benefit sound financial institutions, assist troubled
institutions and protect our financial system, while minimizing
taxpayer exposure. Tomorrow I will be talking in greater detail
about the crisis facing our markets and what I will do as President
to fix this crisis and get our economy moving again.
Holz-Eakin expanded a bit on this plan, but it doesn’t get any
better. On the one hand, the idea is to prevent taxpayer bailouts.
But on the other hand, he acknowledged during the call that this
new government agency would have the backing of Treasury, and
therefore, taxpayers. So under McCain’s proposal, instead of
waiting for companies to be on the verge of collapse to bail them
out, government will take all comers.
Anything McCain proposes on the campaign trail will obviously
get revised should he become president, but his track record as
Senator does not bode well for small government conservatives. He
pushed campaign finance reform and voted for Sarbanes-Oxley, over
the objection of critics who at the time argued that the
legislation would create new problems while not solving what it
sought to address. In both cases, the critics have been proved
right. But it doesn’t matter to McCain, who makes decisions purely
on passion rather than reason.
McCain would govern based on his own outrage, and conservatives
would be left hoping that at any given moment he’s outraged about
the same thing as they are.
