Newspaper article The Evening Standard (London, England)

Scare 'Em Rigid& and Boost McCain Vote

Newspaper article The Evening Standard (London, England)

Scare 'Em Rigid& and Boost McCain Vote

Article excerpt

Byline: ANTHONY HILTON

PRESIDENT George Bush seems to have woken up to the fact that there is a crisis in the financial markets which threatens if it runs unchecked to do serious damage to the US economy. In American parlance the good citizens on Main Street could end up paying for the excesses of the citizens of Wall Street not just through their taxes but through unemployment, bankruptcies slower growth and even the outside possibility of a Thirties-style depression.

The language in his nationwide broadcast last night was apocalyptic but he is a politician if nothing else.

A few days ago his Treasury Secretary, Hank Paulson, revealed a plan under which the US government would spend $800 billion buying sub-prime mortgages and the like from the nation's banks. The theory is that if you give the banks hard cash for duff assets it will restore them to health and allow them to start behaving like sensible banks again, providing credit to the nation's enterprises and helping them to grow. That would mark the end of the crisis albeit at the cost of leaving the taxpayer with $800 billion of dubious assets.

Bush's problem is that the plan has run into opposition in Congress. His appeal to the nation was to get the people on his side so not only would they accept that the colossal sum of $800 billion would indeed have to be spent, but also that they would tell their Congressmen in no uncertain fashion that is what they want. It was a manoeuvre to help him to draw the sting from the opposition.

He needs to do this for both economic and political reasons. It is not just the economy that is suffering. It will not have escaped his notice that each day this crisis runs, the more it damages the chances of a Republican win in the November elections. It is important that he be seen to be doing something and what better way to get the people behind him, than by scaring them rigid? …

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