The rhetoric from President Bush urging the government’s heavy-handed intervention in the current financial crisis is almost too hot to handle. Hot in the sense that he stole his own words from earlier speeches urging the United States into war with Iraq.
The similarities in how Bush justified going to war in Iraq and passing the $700 billion bailout are eerie: The threat is “imminent,” the American resolve is “unwavering,” the plan will “work,” and things will return to “normal.” The government will be in and out of Iraq/banks as quickly as possible. The U.S. is working with the rest of the world to neutralize the Iraqi threat/stabilize world markets. Americans will again be able to walk down the street not worrying about nuclear attacks/401Ks.
Consider the following quotes from President Bush about either the war in Iraq or the $700 billion bailout and guess which issue each refers to (answers below):
1. “We have a strategy that is broad, that is flexible, and that is aimed at the root cause of our problem.”
2. “And the United States, along with a growing coalition of nations, is resolved to take whatever action is necessary.”
3. “Our strategy will continue to evolve and be refined as we adapt to new developments and the inevitable setbacks. But we will not stand down until we have achieved our goals.”
4. “The plan is big enough to solve a serious problem.”
Now, take a look at the answers below. Not so easy, huh?
Since President Bush has used this strategy before and a lot of people are extremely unhappy with the results, why is it working again? For the very reasons it worked in garnering support for initiating the Iraq War. The public lacks the appropriate knowledge, it cannot grasp the magnitude of the action, and the desired outcomes are vague. Average citizens don’t understand what it takes to orchestrate an invasion of another nation any better than they understand what actions are required to stop an economy from crumbling.
The costs of each are staggering. People don’t understand $700 billion, which is, at this point, the price tag of both the war and the bailout, let alone what the potential additional costs might total.
However, more important than the actions and the costs are the outcomes. This is where it gets messy. The stated outcomes in each of these $700 billion undertakings are murky: We will liberate Iraq and spread democracy to the Middle East. We will restore consumer confidence in the market. We will make progress in the more encompassing War on Terror. We will prevent another Great Depression.
These outcomes all sound promising and they make for sound bites that people rally behind, but what exactly do they mean? What does a liberated Iraq look like? Saddam Hussein is out of the picture, free elections took place, and the Iraqi citizens are not being terrorized by their own government. Is Iraq liberated? It is not clear.
Likewise, what does it mean to restore consumer confidence? Is it restored when people go back to spending far more than they make? Is it restored if the Dow goes up for a few consecutive days? What will restore confidence? How will we know?
With no real answers to any of these questions, the President offers little but vague talking points. We need concrete measures of success, not vague “goals.”
When the U.S. government claims that the bailout will work quickly and effectively, U.S. taxpayers should be wary. Very wary. This line has been used before. For better or worse, the war in Iraq has been considerably more costly and taken much longer than most people anticipated in 2003.
The worry for the bailout should be the same, given that the same rhetorical six-shooter has been unholstered to justify the government’s latest actions.