How bad would the bailout be if Congress were to roll over and pass the "clean" bill that the administration is proposing? Bloomberg reports that the Bush bill would exclude regulatory agencies from passing on Treasury's decisions about acquiring debt, and that judicial review would also be prohibited.
Can you spell "SCAM?"
Fortunately, Democrats seem to have some spine--though whether that will bend or break in the next few days (or even the next few hours) remains to be seen. Barney Frank (D.MA, and my congressman) wants oversight by the Comptroller General and the Government Accountability Office. Senate Democrats wand to add provisions that would let bankruptcy judges reform mortgages, limit the pay packages of executives at bailed-out firms and give the government equity in the companies that are unloading their debt. The last provision, in particular, is sure to elicit howls of righteous wrath from Republicans who only want to socialize losses, not the potential for gain.
As of this writing (1:40 p.m. on September 22nd), the Dow is down $250.00. The market is unlikely to rise again--and, indeed, will almost certainly fall--until an agreement is reached on the bailout between Congress and the White House. Look for the administration to push the panic button, hard, to pressure Democrats into giving way. (Such conduct would further speed market decline, but at this point, that's just what Bush and his cronies want.)
Remember how they rushed the Patriot Act through, under the seeming threat of international terrorism? And how bad a job they did? The same thing is going to happen here, because no one is prepared to say that (a) we don't need a bill this week, or even next and (b) that Congress may have to stay in session right through the election to work this thing out right.