Did Wall Street bailout make things worse?

The U.S. stock market is down. World financial markets are in free fall. Treasury Secretary Henry M. Paulson is scrambling to put in place his $700-billion rescue plan. And a billboard in Times Square pitching consumer products shares space with an electronic news ticker that shows Wall Street's reaction to a new plan by the Federal Reserve to buy lots of short-term debt.

Asked to explain why the expensive bailout -- which infuriated the public and could cost several congressmen their jobs at the polls in November -- isn't working, financial experts argue that it's a question of too little, too late. As Georgetown University's Martin Evans explained to the Washington Post:

People are realizing that the Paulson plan is not going to be nearly enough. It's not because the plan is ill-conceived. It looks like it's the right thing to do. But the problem is just growing astronomically.

Bob Barr, the former congressman from Georgia who is running for president on the Libertarian Party ticket, has a different theory. He says the White House, as it did in Iraq, hyped a dilemma to win support for massive intervention. And he said the administration's expensive bailout only made things worse.

The Bush administration once again misled Americans into believing extreme danger was imminent and extraordinary U.S. government intervention was required to save our country. And once again, the intervention of the Bush administration made it worse.... We've gone from threats of mushroom clouds and alleged vials of anthrax to threats of massive unemployment and no credit for student loans.

Arguing that Democrat Barack Obama and Republican John McCain were also complicit in the "alarmism and paranoia," Barr said that President Bush and the major-party presidential candidates "took a bad situation and made it worse -- with taxpayers picking up a huge debt."

Barr's solution? "Bush, McCain and Obama should have taken a deep breath and stayed out of the way as the market continues its painful adjustment process."

-- Johanna Neuman

Photo: Timothy A. Clary / AFP/Getty Images

Comments

[Michael Micelli]

The silent majority is voting for Bob Barr. Are you with US or against US?

[GMSilvia]

I am a veteran and about as patriotic as they come, I have tremendous faith in the people of this nation, we will survive. This year I felt it extra important to pay attention to what is happening with our great nation, we have a stupid war that is maiming and killing my brothers in uniform, for no good reason. That is all it took for me to look into every political party, who offers real solutions to ending this insane bloodshed, that is bankrupting this country, both morally and financially. The only party I found with common sense answers to the big problems facing us, was the Libertarian party, I researched, I joined. Now with this bail out I am convinced, if I understand this right, they take money out of my pocket to put in the bank, so I have to go to the bank to borrow my money back at interest, yeah that helps, but not me the tax payer.

This election is not a game to see if you can guess who will, you don't get a prize for picking the winner. All I suggest is everyone take a minute, and look at what candidates stand for and what they plan to do. I further suggest you look in to Bob Barr, up to you, but what can it hurt to look? Me I am sold, I will be voting Bob Barr the Libertarian candidate in November. Thank you for your time.