WASHINGTON -- In many ways, the congressional battle over the largest federal bailout in U.S. history reflected stark ideological differences among Republicans on whether conservative fiscal principles must yield in resolving the nation's financial crisis.
Just look at the polar opposite ways in which Georgia Republican Sens. Johnny Isakson and Saxby Chambliss and Alabama Republican Sens. Richard Shelby and Jeff Sessions approached the near $1 trillion proposal to rescue the nation's financial sector.
As the ranking Republican on the Senate Banking Committee, Shelby ordinarily would have stood poised to back the Bush administration proposal. Instead, Shelby, along with Sessions, has railed against the bailout to national media outlets and just about anyone who will listen.
"I do not believe this is the right approach," Shelby said soon after the Bush administration unveiled the proposal and urged swift passage. "We did not get into this situation in a matter of days, and we are not going to fix it in a matter of days."
Shelby, a free-market Republican and successful real estate businessman, has emerged as one of the most powerful opponents of the bailout. He steered clear of a bipartisan meeting with congressional leaders on Capitol Hill last week and expressed his frustration after a revised version of the proposal passed the Senate on Wednesday night.
"The secretary of the treasury came to Congress with his plan, he threatened us that if we don't pass it there will be dire consequences, and pretty much, with some retrenchment of his ideas, he's gotten what he wanted," Shelby told the Birmingham News.
Just across the state line, fellow Republicans Chambliss and Isakson said immediate government action was necessary to save the economy, voted for the retooled plan and have weathered an onslaught of public backlash as a result. In just over two weeks, Isakson's office received more than 12,000 e-mails, phone calls and faxes -- mostly from constituents opposed to the bailout.
Still, he and Chambliss felt it was important to hold firm.
"Tonight was not a night to say no to the future of the American people. Tonight was not a night to say we don't have a responsibility to help," Isakson said in a statement after Wednesday's vote. "... This legislation is critical to allowing us to unclog the financial markets, free up credit to the average American and over time restore the American economy to what it has been and always will be -- the best entrepreneurial capitalistic system in the world."
None of the four men are known as ideological leaders, said Michael Tanner, a senior fellow at the Cato Institute and author of "Leviathan on the Right: How Big-Government Conservativism Brought Down the Republican Revolution". Instead, all four senators are seen as "middle of the road and they're being blown in either direction."
"In many ways it is a set of differences that have existed over the course of the Bush presidencies among some of the leaders in Congress," Tanner said. "There's the group that has been in favor of big government conservatism -- what really counts is the ends and it's OK to have big government accomplish those ends. ... At the same time there's been a small-government constituency that's been seething under the radar screen. This one was finally one step too far for the small-government branch of Republicans to accept."
Shelby says he has always opposed direct government bailouts. He helped steer legislation through the 1980s savings-and-loan crisis and voted against a 1990s-era deregulation bill known as the Gramm-Leach-Bliley Act out of concerns over inadequate safeguards of consumer privacy.
Chambliss and Isakson are newer to Congress and, like Shelby, they, too, supported the government takeover of mortgage giants Fannie Mae and Freddie Mac as a "necessary step."
Such votes may also offer an indication of the way the Republican caucus is reshaping itself in preparation for a new president, Tanner said.
"They're also beginning to state positions for the post-Bush era. Win or lose, Bush was a transitional figure. What they're now looking at is what will the Republican Party be after November 4th," Tanner said. "These guys are saying, 'We're not going down the path the Bush administration has taken us down. We want to take up the Reagan mantle.'"
Comments