In an earlier post I said, "Why should republicans favor a bailout? Don't they recognize a welfare corporation when they see one?"
I did not like Paulson's initial plan, which was a naked power grab and not much of a plan at all. I am still thankful Washington had enough sense to oppose the creation of a financial emperor.
However, Christopher Dodd then came forward with a plan that said, public money demands public scrutiny, and public money is not toilet paper for the irresponsible investor. It wasn't perfect, but it was an honest effort to fix the mess without ceding Congressional oversight. It was fast gaining bipartisan traction until John McCain arrived to "help", at which point it died a political death.
I also felt earlier that Congress should delay any bailout because Wall Street seemed like an addict that expected to publicly finance its' heroin addiction. Let them sweat a bit, I thought, then maybe they'll realize they could fail and will be less reckless going forward, and less demanding of their saviors. Maybe that is what is going on and explains Congress' upcoming holiday break?
I prefer doing as little as possible until a new administration arrives. The Bush administration is played out; they have no more credibility. Nobody wants to be their dance partner to the dance. But, historically accurate economists like Paul Krugman say we need to act soon.
I guess you must go to the financial market crisis with the leader you have and not the leader you want.