Published October 1, 2008
COMMENTARY
Who is behind the mess at the Capitol?
By LEON HADAR IN WASHINGTON

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CAPITOL Hill is a place where US lawmakers have supported policies and approved legislation that changed American and world history, including the protectionist Hawley-Smoot Tariff Act that accelerated the coming of the Great Depression and the global economic crisis of the 1930s.
It's not inconceivable that the last days of September 2008 would be recalled by future historians as a time when US lawmakers, driven by a desire for political self-preservation and ideological dogma, helped set in motion the Great Depression II.
Leading the set of villains would be those lawmakers who would be seen as responsible for one of the most shocking legislative debacles in American history, the Monday vote having scuttled the proposed US$700 billion financial bailout plan.
Heading the charge were a group of conservative Republican lawmakers in the House of Representatives who decided to vote 'no' for the compromise legislation that had been worked out over the weekend by Democratic and Republican leaders on Capitol Hill and Bush administration officials, led by Treasury Secretary Henry Paulson.
And why did they decide to change their vote in the last minute, causing the stock market to plunge and to wipe US$1.2 trillion off the books?
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Well, it seems that the oh-so-sensitive Republican lawmakers were furious at the Democratic Speaker of the House, Representative Nancy Pelosi from California, for criticising the Bush administration's economic policies when she introduced the legislation. The poor kids. Teacher Pelosi hurt their feelings so much.
So they decided to punish the Republican Bush administration and anxious investors who were waiting for Washington to come to their rescue.
Bipartisan negotiation
In fact, in her short speech before the vote, Ms Pelosi expressed her own shock when Mr Paulson and US Federal Reserve chairman Ben Bernanke had warned her and other Congressional leaders of the danger of a financial meltdown, and pleaded for a bailout.
She stressed that she and her fellow Democrats felt that they had no choice but to negotiate with the Republicans on a legislative deal to help save the economy. But the House Republicans claimed that they were appalled that the Speaker would say such things. In fact, they just used Ms Pelosi's speech as an excuse to vote against the Bill that they and their constituents at home didn't like. (The Congressional election takes place next month.)
'We put everything we had into getting the votes to get there today,' said John Boehner, the Republican Minority Leader in the House. 'But the Speaker had to give a partisan voice that poisoned our conference; it caused a number of members, who we thought we could get, to go south,' he explained.
'There's a terrible crisis affecting the American economy,' responded House Financial Services chairman Barney Frank, a Democrat from Massachusetts. 'We have come together on a Bill to alleviate the crisis. And because somebody hurt their feelings, they decide to punish the country?' he said.
The result was a defeat for the Bill, 205-228, with two-thirds of Republicans and more than a third of Democrats (most of them were members of the Black Caucus) voting 'no' - which stunned officials, lawmakers and the media in Washington. It was greeted in Wall Street with a sense of foreboding. Pundits raised the possibility that the American economy was heading, indeed, into a painful and long recession as the credit freeze creates disincentives for new investment. There is going to be more personal and business bankruptcies, followed by rising unemployment.
No new votes were scheduled for yesterday and today over the Jewish New Year, which means that the American and global financial markets would probably continue to slide down in the next two days.
'Grown-ups' will take charge
But top Democratic and Republican leaders insisted that the 'grown-ups' would take charge before the end of the week and get the bailout plan approved by both the House of Representatives, followed by the Senate (where there seems to be a clear majority in favour of the legislation).
So everyone seems to be waiting for those 'grown-ups', although one of the main concerns on Capitol Hill is that the Republican presidential candidate, Senator John McCain, would attempt once again - like he did last week - to interject himself into the negotiations in Washington. He may demand perhaps that the televised debate between the two vice-presidential candidates scheduled for tomorrow be cancelled.
Who knows? Is it possible that his running mate, Alaska governor Sarah Palin - who boasted about her foreign policy credentials by noting that she can see Russia from the window of her home in Alaska - might try to help end the financial crisis? Perhaps she can also see Wall Street from the window of her house.