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Thu 2 Oct 2008 04:00 AM

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Bailout bill is a mud sandwich..

When the 'fin de siecle' mood of Hollywood combined with 9-11 paranoia, a new genre of disaster movies was born.

Bailout bill is a mud sandwich..
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When the 'fin de siècle' mood of Hollywood combined with 9-11 paranoia, a new genre of disaster movies was born.

We had 28 Days Later (monkey virus mutates to humans and everyone dies), then there was Deep Impact (asteroid hits Earth and everyone dies) and The Day After Tomorrow (planet freezes over and everyone dies).

As financial Armageddon loomed larger this week, one wonders if scriptwriters are already working on Meltdown the Movie, the story of how the world's financial markets collapse and everyone dies from toxic debt poisoning.

I suppose the challenge is making mortgage-backed bond salesmen suitably scary for the big screen. In Meltdown the Movie, Congress would give Treasury secretary Hank Paulson the backing to go after the badass assets and do whatever the hell was needed to save the world. He's a maverick, sure, but he gets results and he's the best damn Treasury secretary this department ever had.

Unfortunately, nobody appeared to have shown Congress the script on Monday afternoon when it voted 228 to 205 against Paulson's $700bn bailout plan to buy up all the toxic debt sitting on the balance sheets of the nation's big banks. Party politics, which had ostensibly been put to one side while the nation's leaders tried to find a solution to the financial crisis, resurfaced at the crucial moment to defeat the bill.

"Motion to reconsider?" piped up one Congressman, somewhat hopefully, when the count came in.

Motion to reconsider? Isn't that like when you lose a game of heads and tails and you say: "OK, how about best of three?"

Although the Senate has subsequently approved the reworked bill, ultimately the vote may have reflected the mood of the nation. Despite the convincing arguments made by Paulson, Bernanke and the backers of the original bailout plan, the notion of letting the big banks off the hook by absorbing their questionable assets seemed too much like rewarding them for their folly, greed and betrayal. It might even be called un-American.

More than 1 million people have lost their homes in America in the last two years, a staggering number that conveys both the magnitude and human face of this crisis.

Paulson's approach to solving the problem may have seemed practical in the eyes of a banker or from the perspective of many of us viewing the situation from afar.

But for those people who lost their homes (many of whom have also lost their vote in the forthcoming elections because they are still registered at their foreclosed properties), any bailout of the banks must surely seem obscene.

The Republican leader in the House, John Boehner, described the defeated bill as a "mud sandwich".

Ultimately it proved too much even for a desperate Congress to swallow first time round.

The new version approved by the Senate may have been made with sweeter bread – but the filling remains the same.

Sean Cronin is the editor-in-chief of Arabian Business English.

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