L.A. congressman's bailout blog: Why I switched from "no" to "yes"

Three Los Angeles House Democrats switched their votes on the bailout from "no" to "yes," according to the tally released by the House Clerk's office. The Democrats who voted against the $700-billion bailout earlier in the week, and then switched and voted in favor of the expanded, $810-billion bailout today, are:

Rep. Adam Schiff (pictured), whose 29th district includes parts of Burbank and North Hollywood. Schiff explains his reversal on his blog here, writing:

At the end of the day, the only reason I supported a bill in which the good narrowly outweighs the bad, is that the worst option of all, in the face of repeated bank failures, record foreclosures and soaring unemployment, would be to do nothing at all.

... The original Paulson plan, though much improved by the Congress, is still much deficient. It cannot be viewed as the end of the fiscal and economic crisis or the end of our response to it. But it may be seen as the end of the beginning.

Also switching votes from "no" to "yes":

Rep. Hilda Slolis, whose 32nd district includes parts of Azusa and Covina
Rep. Diane Watson, whose 33rd district includes parts of Culver City and Ladera Heights.

Below is the entire delegation from Los Angeles County, and how they voted on the first bailout vote, and the second bailout vote.

22nd Congressional District
Lancaster; Republican Kevin McCarthy voted no and no.

25th Congressional District
Lancaster; Republican Howard McKeon voted yes and yes.

26th Congressional District
Altadena, East Pasadena, La Canada Flintridge, La Crescenta; Republican David Dreier voted yes and yes.

27th Congressional District
Burbank, North Hollywood,  Sherman Oaks, Winnetka; Democrat Brad Sherman voted no and no.

28th Congressional District
Encino, Pacoima,Toluca Lake, Valley Village, Universal City; Democrat Howard Berman voted yes and yes.

29th Congressional District
Burbank, Glendale, Pasadena; Democrat Adam Schiff voted no and yes. Schiff switched.

30th Congressional District
Agoura Hills, Beverly Hills, Calabasas, Hidden Hills, Malibu, Santa Monica; Democrat Henry Waxman voted yes and yes.

31st Congressional District
Los Angeles; Democrat Xavier Becerra voted no and no.

32nd Congressional District
Azusa, Baldwin Park, Covina, Duarte, El Monte; Democrat Hilda Solis voted no and yes. Solis switched.

33rd Congressional District
Culver City, Ladera Heights, View Park-Windsor Hills; Democrat Diane Watson voted no and yes. Watson switched.

34th Congressional District
Bell, Bellflower, Bell Gardens, Commerce; Democrat Lucille Roybal-Allard voted no and no.

35th Congressional District
Gardena, Hawthorne, Inglewood, Lawndale, Los Angeles (South Central); Democrat Maxine Waters voted yes and yes.

36th Congressional District
El Segundo, Hermosa Beach, Manhattan Beach, Redondo Beach, Torrance; Democrat Jane Harman voted yes and yes.

37th Congressional District
Carson, Compton, Long Beach; Democrat Laura Richardson voted yes and yes.

38th Congressional District
Industry, La Puente, Montebello, Norwalk, Pomona; Democrat Grace Napolitano voted no and no.

39th Congressional District
Artesia, Cerritos, Lakewood, La Mirada, Whittier; Democrat Linda Sanchez voted no and no.

42nd Congressional District
Diamond Bar, Whittier, Rowland Heights; Republican Gary Miller voted yes and yes.

46th Congressional District
Part of San Pedro. Republican Dana Rohrabacher voted no and no.

--Peter Viles

Photo Credit: Bloomberg News

Comments

[ShameandScandal]

Politicians who are desperate to position themselves have only one tool, to say 'I did something to fix the mess' is a much better place than 'I did nothing.' They realize that their present political risk is failure of the 'plan,' which they will rationalize with 'the plan will take time to work.' To those who support the 'plan,' note that it is careful to not define 'success' with any common sense measures that would provide any level of accountability. Their arrogance and contempt for the American people has hit a new all-time record.

Sadly and unfortunately, the political calculus ignores the real economic cost of using up to $700 billion of monetary 'energy' will serve as a drag on U.S. economic activity for years to come. Imagine the real choice, allowing the shareholders and bondholders to lose the value of their investments and leaving the junk/toxic mortgage-backed securities and exotic structures to die, and recapitalizing the banks with new money, or spending up to $700 billion on assets with productive uses; roads and bridges, primary and secondary education, clean air and water, and subsidies for new advanced industrial and medical technologies that need such support to enter the marketplace. The authorities of the FDIC and Federal Reserve could have been clarified and strengthened.

Instead, that energy will be dedicated to suspend indefinitely the values of junk investments. Imagine Japan for the past 15 years, except that Japanese actually save a significant portion of their incomes and the U.S. saves nothing, money junkies depending on the kindness of oil- and other goods-exporting nations. The political bums are also extremely careful to avoid saying anything about the money that won't be spent as a result of this scandal. Lots of talk about protecting 401k values, no talk about clipping Social Security and Medicare, or defense spending. Only in Washington can a 'serious' discussion pretend that a $700 billion decision has no effect on anything else.

The political 'fix' could have provided taxpayers with an ownership stake that is senior to the existing shareholders, but, alas, that would have recognized that honest, employed, play-by-the-rules taxpayers should not be left holding the bag. In the Bush/Cheney regime and the asleep-at-the-switch appeasing Democrat Congress, that would violate a core value.

As a consequence, taxpayers now have a clear choice. Vote out every old bum, the R bums and the D bums, and vote in new bums. Or, not.

Next litmus test for the political bums; deciding whether the universe of these exotic securities and derivatives will in the future come under clear and consistent rules for price discovery and transparency. This would create the foundation for a stable and sustainable financial industry, and business activity. Of course, it would reduce the likelihood for recklessness, greed, corruption, and incompetence, the basic food groups of political campaign contributions that feed the Congress and the unelected bureaucrats in Washington, who are addicted to their sense of entitlement for making short-sighted and boneheaded decisions about your money and economic livelihoods.

[Seriously]

Pegpond -

Likely the most propaganda-ridden, over-simplistic version of our crisis I've read to date. And most damning, factually incorrect in places.

You are the sheep. Read a book - and when you do - read one that challenges you to think.

[Steve Peek]

$700 BILLION BAILOUT CAN BE WIN-WIN-WIN FOR CITIZENS, BANKERS AND CONGRESS

My Senator, Barbara Boxer, responded to an email asking her not to vote for the bailout plan without considering more options. She said the primary reason she voted YES was because she heard from California the news that without the bailout California would not be able to 'sell voter-approved highway, school, and water bonds.'

Congress simply does not get that they not only have to do something, they have to do it right. What if there is a way to make everyone a winner?

Unfortuntely, I am old enough to recall previous decades. One recollection is of a time when all gasoline taxes went to the department of highways, both state and Federal. Before Congress moved these taxes to the general fund, my memory is we had little problems paying for infrastructure in our country. We were the world leader in expanding and improving roads. It makes me wonder why now we can't keep California highways ahead of growth even with selling bonds.

Another memory is from the same era: when taxes collected for Social Security were earmarked only for Social Security, again, before Congress moved this money to the general fund. By correlating average U.S. salaries, cost of living, annual interest earned and cost of administration over the last thirty years, it is very clear that had Social Security money been kept out of the general fund it would today be, at worst, solvent and able to bear the increased demands placed on it by Baby Boomers. At best, assuming an investment return of 2% over prime, it would currently have an enormous surplus -- enough to get us past the Baby Boomer demographic. It might be interesting for you to have someone run the numbers.

One of the reasons so many people opposed the bailout has to do with Congress, the institution. We may still have faith in our individual elected officials but Congress as a whole has provided so many examples of short sighted thinking, graft and corruption, and lack of intelligent thinking in the bills passed in teh last thirty years that the majority of Americans have a difficult time trusting the collective members currently sitting Washington.

Why not place $2,000 in every American citizen’s Social Security account (roughly $700 billion) and then loan the money to the financial institutions in trouble. Think about it.

Good luck, God bless,

Steve Peek

[Barry]

In one stroke of a pen British has just solved their Banking crises while USA fusses with the biggest bailout of corporate America (World). It is smart to Nationalize bank 50% thus owning the assets and controlling their function and also allowing to guide the bank’s future operations as well as creating a façade of guarantee the markets are looking for to assure government backing is there.

Why can USA do something like this instead of pretending.

[YonkersMom]

One way that would shock and awe the financial industry is if all that bailout money wen to the AMERICAN PEOPLE to put back in to the economy. That would flip the script on corporate america and make them pay attention like never before. Right now, the money is being dispensed to THEM and we have to wait for it to trickle down to us.

BUT, if the government were to disperse that money to every American household, that money wouldn't trickle into the economy, it would flood the economy and have the banks and businesses clamoring for US to spend it with them and here's how:

1) We would rush to pay off all of our bills, so therefore, the credit card companies have an influx of money to issue NEW credit and invest. Now with a huge segment of the American population free from credit card debt, the credit card companies will have to provide some incentive to keep us because there are so many credit card banks and companies to choose from.

2) Some Americans being debt free would catch up on their mortgage, therefore providing an influx of the money into banks and financial institutions who can now refinance and help struggling homeowners who are facing foreclosure, as well as offer NEW LOANS to homebuyers to take some of the foreclosures off their books and put them back on the market where they will then generate taxes again, to the delight of the city.

3) Some Americans being free from credit card debt and caught up on their mortgage may need a new car, therefore car dealers will probably see more business and sales will pick up quite a bit.

4) Airlines will see more people starting to fly again since people will have more passive income.

5) Retailers will benefit because people are likely to shop a bit more now that their bills are paid.

In general the economy will thrive a lot sooner if this money were put into the hands of the AMERICAN PEOPLE (after all it IS our money to begin with) and NOT Corporate America. ANY THOUGHTS ON MY IDEA??

[VIVEK JAIN]

Dear all, no offence, but i persnoally feel, before seeking a bailout, would it not be in order, that the company seeking a financial package / bailout from the public money, in the first place cut down all its flambount expenditures, like business class tickets, 5/7 star hotel stays, super luxury cars, etc to its top executives, CEO's, directors / promotors, etc.

[Loans Modifications]

Why is that there are so many people against this bailout plan? If the administration is saying that this could really have a great impact on the economy they why not give it a shot first.

[Ares Vista]

When our government is the primary stockholder in a corporation or market, and the president is firing CEO's, that is socialism. Is this really the direction we want to be heading? NO!