This is an icredible opportunity for Obama, if only he seizes the populist underpinnings of all this

[Bread and Circus]

First off, McCain and Bush are hiding. It's time to be out front. Leaders are present. Right are wrong, they need to be strong and out front and standing up.

Secondly, the collapse of this deal represents populist instincts ruling the day. If Obama were to get out on front in this he could use this an opportunity to usher in a better bill.

If I were Obama right now I be huddling with my economic team and coming up with a serious plan and a press conference.

[TwilightGardener]

1. What is this "better bill" I keep hearing about?

[geek tragedy]

2. THERE IS NO BETTER BILL.

The two options are:

1) Democrats caving;

2) No bill at all.

Jesus.

[Bread and Circus]

3. or 3.) Obama provides a new roadmap.

[Auggie]

5. I just heard Jackie Speier (CA. Democrat, 12 District) say on radio that

Congress will have an alternate bill by the end of the week

[Every Man A King]

4. Dems can start adding sweeteners to the bill

To get more democrats to vote for it. Healthcare, Iraq Timetable, whatever. The door has been opened to do this.

[aldo]

6. It's crunch time for Obama, does he have it in him?

He'd have to throw out half his advisors to craft a populist recovery. We need to go back to FDR principals of protecting the productive parts of the economy. The speculative parasites deserve their own fate.

Bankruptcy reorg of the entire banking system -- this would protect the commercial banks and keep the financing flowing.

[ContinentalOp]

7. Exactly! Why do we even need Republican support to pass a bill.

We needed them to back that shitty bill so we wouldn't face the political repercussions.

But why can't the party now show some real vision and craft a plan that the American people will support? Then we can pass some real reform and we don't need the support of a majority of Republicans.

[ProgressiveEconomist]

8. Rahm Emanuel mentioned some of this on CNBC today. The most populist element of the EESA bill also ...

also is an element of financial genius. Obama insisted on foreclosure prevention to keep homeowners from being put out on the street.

But this provision also could help taxpayers, especially if Treasury prioritized "bad paper" CDOs for purchase by zipcode delinquency rates of the mortgages inside them. As owner of large numbers of "CDOs" each made up of pieces of hundreds of individual mortgages, Treasury could increase their value by working out realistic payment temrs with homeowners rather than putting them in the street.

In its current form, the bill does not say much about this aspect of the plan. But the section covering foreclosure prevention could be rewritten to drive the choice of "bad paper" to buy.

From http://www.nytimes.com/2008/09/23/opinion/23kashyap.html?ref=opinion&pagewanted=print :

"The $700 Billion Question By ANIL K KASHYAP and JEREMY C. STEIN September 23, 2008 Op-Ed Contributor

"Beyond just buying and holding, a second job for the agency might be to restructure the mortgages it acquires. For example, it could reduce required interest payments so that fewer homeowners default on their loans. Done well, this could avoid costly foreclosures, thereby benefiting homeowners while also raising the value of the securities that the government has bought. This sort of restructuring has been difficult until now, because individual mortgages have been sliced and diced, and the pieces widely scattered. However, if the new agency winds up owning a majority of all problem mortgages, reconfiguring them so that interest payments are lower may become practical."

BTW, the authors of this op-ed are the brains behind the fundamental "insurance" idea McCain, Ryan (R, WI), and the House Republicans insisted upon. (see their very technical paper at http://www.kc.frb.org/publicat/sympos/2008/KashyapRajanStein.08.08.08.pdf ). But of course insurance must be bought in good times, not while you're on your way to the operating room.

[MindMatter]

9. Absolutely. Here's a plan

The bill that was put forward was bullshit. It only gave lip service to Obama's 4 principles. They were all presented as soft options that the SoT could do only if he felt like it. We knew exactly what they had in mind. They were going to groove the full $700Bn to their palls and not do any of the other stuff.

But politically Obama could not be seen as opposing it or else Bush and McCain could blame Obama for their mess. Once again, he was thinking way ahead of them. He killed the bill with kindness. The house dimwits figures that if Obama was for it, then they were going to be agin' it -- which played right into his hands. The lousy bill got killed and he is in the clear.

But now he can come strong with those 4 principles. Those principles -- especially limiting CEO pay severely (real limits, not BS) and allowing bankruptcy judges to renegotiate mortgages -- would be EXTREMELY popular with the public. If Obama rides them hard he can dare the GOP to kill that bill with the argument that if the GOP won't pass these measures, then you need to vote them out of office now.

He is definitely in the power position now. Let's see some hardball.