I am afraid that this is true:
One interesting aspect of the recent government bailouts has been the complete irrelevance of Congress. The operation and decision-making seems to be run almost entirely by the Secretary of the Treasury and the Federal Reserve. Congress appears to lack the ability, the will, and the decisiveness to play any role except spectator, as a handful of senior executive branch officials have nationalized major portions of Wall Street.
I think this is a dangerous trend. Much as we disdain it as a squabblers’ club, Congress is the representative body of the federal government. The weakening of Congress means the weakening of democracy itself.
The last forty years have seen an increasing irrelevance for Congress for several reasons. The emergence of the U.S. as a superpower in a cold war made the executive much more important than it had been in earlier and more peaceful times. The increasing scope of government to include almost every possible activity meant more and more legislation, and in turn that Congressmen could devote less time and study to each particular issue.
Congress itself shares a lot of the blame, however. Since the sixties the Congress has repeatedly shoved the tough issues off onto the courts and the executive. Congress increasingly passes high-minded but vague legislation that leaves the actual decision making to the other branches. For example, the Americans with Disabilities Act’s notorious “reasonable accommodation standard” which left it to the courts to decide on a case-by-case basis how much a business had to spend to accommodate disabled customers and employees.
Congress is making itself irrelevant by progressively pushing the real responsibility for the government’s decisions onto the less representative branches. That means that you and I have less and less say in what goes on.
POTUS apparently approves the decisions that Bernanke and Paulson are doing. He’s been saying as much for the past year. He hired them. And McCain says the fundamentals are okay. He should know. He and his chief economic advisor Phil Gramm helped engineer what has been going on. Let’s not judge the Republican controlled branches of government until we have a better perspective. After all, eight years of power should count for something.
To my mind, Congress represents the Democratic and Republican parties. They don’t represent me.
“Since the sixties the congress has repeatedly shoved the tough issues off onto the courts and the executive.”
Absolutely correct. For any contentious issue that could potentially cost them their seats, Congress would rather pass the buck to the courts rather than deliberate. My contempt for Congress (both parties) is boundless.
On Wall Street, you know that America’s economic leadership rests on strong and flexible capital markets. Capital markets connect entrepreneurs with the investment they need to turn their ideas into new businesses. America’s capital markets are the deepest, the broadest, and the most efficient in the world. Yet excessive litigation and over-regulation threaten to make our financial markets less attractive to investors, especially in the face of rising competition from capital markets abroad. To keep America’s economic leadership, America must be the best place in the world to invest capital and to do business.
— from George Bush State of the Economy Report, New York Federal Hall, January 31, 2007
Mike is only telling half the story
[Moderators.. if this is too long, please edit it]
This is from the NYT 23 Oct 1999
WASHINGTON — The Clinton Administration and top Republican lawmakers reached an agreement early Friday to overhaul the financial system, repealing Depression-era laws that have restricted the banking, securities and insurance industries from expanding into one another’s businesses.
[…]
http://partners.nytimes.com/library/financial/102399banks-congress.html
To make a long story short.. the Republicans reformed the banking industry.. the Democrats insured that every bank would introduce ticking-time-bomb loans into the world’s finance system.
read the entire article and you will note that Congrwess is very vry concerned about how the Bush administrtation is once again doing things without consultation-recall the Iraq mess–and Congress is in fact reaxcting:
[…]The scale and complexity of the project are almost certain to create huge philosophical differences among the parties, which could make negotiations difficult to say the least. Still, lawmakers said the goal was to work through the coming weekend and to have both the House and Senate vote on a measure by the end of next week.
As they exited the session, grim-faced lawmakers said they would await proposals from the Treasury Department. The Senate majority leader, Harry Reid, said he expected to see a proposal within hours, not days.
“What we agreed to do is sit down together on a bipartisan basis and work together to solve the problem,” said Senator Mitch McConnell of Kentucky, the Republican leader, who said no specific approach was advocated by the administration officials.
President Bush and his top advisers have adamantly opposed bailouts, but the mortgage crisis has already forced the Treasury and the Fed to bail out four of the country’s most prominent financial institutions […] NY Times, today, front page.
the post is simply another try at badmouthing someone and letting it go at that.
To everybody,
Actually, this post wasn’t about the bail out per se at all but rather the observation that the executive moved to fix this enormous problem with relatively little input from the congress.
Whether the apportionment of blame properly rest on this or that party is outside the scope of this post.
Vince,
The half that I am telling is the whole for now. Clinton isn’t running for President; John McCain is. Yes, the final vote in both Houses for repeal was a huge majority (and McCain abstained). But having the architect of the repeal as your chief economic advisor is essential to note. We are reaping what was sown back in ’99. The country does not need to go back to the future. Just this week McCain stated the fundamentals are sound! How out of touch is he and many other Repubs and Dems and POTUS.
“Actually, this post wasn’t about the bail out per se at all but rather the observation that the executive moved to fix this enormous problem with relatively little input from the congress. ”
What do you expect Bush to do? Bush, the Treasury, WSJ, The Fed, and others have been complaining to Congress all throughout Bush’s term about the dangers of the GSEs and the Democrats in Congress prevented anything from being done.
In fact if one were paranoid one could arrange the facts so that you could say the Democrats planned for this to happen. I mean what else did they think would happen when they forced banks to throw away their lending standards and give out loans to people who wouldn’t pay them back?
And much blame to the Republicans for sitting around and tolerating this.
I’m ready for the inevitible military coup
Well Congress has balked since the law they passed in 99.
oops the last line in my comment “Well Congress has balked since the law they passed ” shoudln’t be there.