According to the AP, Speaker Pelosi is already making plans for an Obama presidency, specifically writing more bailout stimulus checks:
After consulting with Barack Obama, Democratic leaders are likely to call Congress back to work after the election in hopes of passing legislation that would include extended jobless benefits, money for food stamps and possibly a tax rebate, officials said Saturday.
The bill’s total cost could reach $150 billion, these officials said.
I guess the thinking is that if bankers and bondholders get trillions as part of various bailout plans then why can’t the working poor have another $150 billion?
Has it occured to any of the Democrats that they are doing far more harm for the working poor by levering up the Federal Government’s balance sheet? What will happen to them when interest rates shoot through the roof? (This, by the way, is a primary argument against the bailout plans themselves.)
Right now interest rates on Treasuries are low because everyone’s panicking and flying to quality. But over time, the speculative bubble in Treasuries will burst, just as the oil, housing and internet bubbles did. Congress can’t borrow an unlimited amount of cash without eventually causing a spike in long-term interest rates.
Did anyone notice last week that credit default swaps on U.S. government debt were higher than for Campbell’s? Yeah, the soup company.