Here is, I think, a pretty safe prediction: The Republican presidential nominee in the summer of 2012 will have come out against the Paulson-Bernanke bailout plan in the fall of 2008. Conservative rage against the $700 billion "rescue" attempt, as President Bush terms it, has been stoked white hot by Newt Gingrich, Rush Limbaugh, and the powerful pundits of the right-wing blogosphere such as Michelle Malkin and Jonah Goldberg. But the inherent skepticism was there from the very beginning. Economist Brian Wesbury sums up the fears of many economic conservatives: "When the public hears the government must save the economy from capitalism run amok it loses faith in our free market system."
It's all about "first principles" as Fred Thompson might describe it. And a belief in the wonder-working power of free markets is about as basic as it gets for conservatives. Indeed, savvy political observers might have noticed that 2008 runner-up Mike Huckabee has already come out against the bailout. He wrote the following on the Huck Pac website on Sept. 23: "Frankly, I'm disappointed and disgusted with my own Republican party as I watch them attempt to strong-arm a bailout of some of America's biggest corporations by asking the taxpayers to suck up the staggering results of the hubris, greed, and arrogance of those who sought to make a quick buck by throwing the dice."
Count Gov. Mark Sanford of South Carolina as another member of the anti-bailout bunch. On Sept. 25, he told the Greenville News that he didn't believe Paulson's apocalyptic financial warnings. But other prospective 2012 candidates have hopped on board. Tim Pawlenty says he is reluctantly for it. And if McCain finally endorses the Paulson Plan, then count Sarah Palin in, too. Guilty by association. (Or sainthood if McCain kills the bill.) As for Mitt Romney, he's been discussed as a possible member of an oversight board that would monitor the purchases of toxic mortgage debt from Wall Street banks. He might want to say "thanks, but no thanks" to that gig. No word yet from Bobby Jindal or David Petraeus.
Now 2012 may seem awfully far away right now. But is there any doubt that Hillary Clinton would be the Democratic nominee today if she had voted against the Iraq War back in 2002? She was for it, Obama was against it, and Obama is the nominee. And don't be surprised if there are insurgent Republicans in 2010 who run against incumbent GOPer who voted for the bailout in a replay of the 2006 Lieberman-Lamont Democratic primary battle.
You know, there is a conservative meeting every Wednesday here in DC where aspiring conservative politicians show up to make their case to the activists. Each one is asked his or her view on "babies (meaning abortion), guns, and taxes." I think "bailout" might get added to that mix.
Newt Gingrich said voting for the bailout will break against candidates in 2010 and beyond when voters see how destructive it is to the economy. And that's the thing. While the bailout, if Paulson and Bernanke are to be believed, may prevent a financial meltdown, it will not by itself return America to prosperity. The labor market is clearly weakening, and is the last thing to turn around once an economy does regain momentum. So there's a good chance that a perturbed public, currently down on the bailout, will view it as an expensive flop by the time the midterm elections roll around. They will hold its supporters accountable. In other words, anyone cybersquatting www.PaulsonforPresident2012.com