The Democrats feel compelled to co-opt the Republicans, because (1) the bailout proposal is very unpopular, getting heat from both the left and the right; the left considers it as the American taxpayer being asked to pay off Wall Street losses and multi-million dollar "golden parachutes" for executives running their businesses into the ground, and the right basically sees as an overly expensive government intervention and (2) they don't want to get blamed for a recession or depression triggered by loan freezes as a cascading effect of this crisis.
My previous post dealt with McCain decision to suspend his campaign on Wednesday afternoon to try to find room for an agreement. I've seen one report that says Treasury Secretary Paulson only got a handful of House Republicans willing to show up at a bailout briefing and contacted Senator Lindsey Graham, McCain's closest friend, about getting McCain to rally the GOP Congressional members behind the plan. It also appears that Bush and Paulson had not really consulted with House Republicans, and the latter balked at what they saw as an unprecented massive government intervention into the economy, which they considered against conservative principles. The House Republicans are not happy with lame duck G.W. Bush, whom seemed to want them to take the lead on a highly unpopular bill without wanting or requesting their input. It does appear at some point Paulson was briefed on conservative alternative proposals, e.g., 2-year suspension of capital gains taxes, insurance or loans (vs. federal cash), etc. (cf. my last post's summary on the Gingrich suggestions).
Senate Majority Leader Reid begged for McCain's support on Tuesday--but things suddenly switched his tune when McCain suspended his campaign, and Obama, seemingly caught flatfooted despite McCain's request for Obama to join him in Washington, responded by refusing the courtesy to postpone the debate scheduled for Friday. McCain contacted Bush, whom basically requested both Presidential candidates show up for a Thursday afternoon meeting at the White House, along with Congressional party leaders, plus committee members.
The Democrats saw themselves in basically a no-lose situation: If the bailout worked, they put it through; if it didn't, they could blame Bush and/or the Republicans. However, when McCain announced he was coming, they were in a state of panic: They didn't want John McCain swooping in at the last moment to claim another notch on his bipartisan belt, particularly at the expense of Obama, when they had done all the hard work over the past 2 days without him. They further impugned his motives, suggesting that John McCain was doing it because of sagging poll numbers and feared losing the upcoming debate with Obama. [First of all, McCain was signaling support for the basic framework of what was being discussed, which Reid himself acknowledged the prior day. Second, McCain asked Obama to join him, which clearly implies any credit, if the candidates claimed any credit, would be shared. Third, as the winner of the Saddleback Civic Forum and who is on the record for repeatedly asking Obama to join him at 10 joint townhall meetings and additional Presidential debates, McCain was hardly ducking a debate on foreign policy, one of his strong suits--he had asked for postponement until the bill was done.]
McCain was briefed on the House Republican key bailout alternatives before proceeding into the meeting. It appears that Reid and Pelosi were finalizing a bill largely negotiated among key Senate Banking Committee members, including chairman Democratic Senator Chris Dodd, and Congressman Barney Frank, ranking House chair. It appears that there was no effort whatsoever to reach out for the input of House Republicans, but when informal word reached them, the Democrats reacted angrily, suggesting this was a totally unexpected obstructionist development meant to unravel things just as they thought they were finalizing the bill. As John McCain would later point out, there was no consensus--apparently the Democrats thought that Bush and/or McCain would shove the bill down the House Republicans' throats, with Pelosi demanding at least 100 GOP votes. The Democrats were simply in a state of denial.
I have only read 2 or 3 accounts of what went on during the meeting at the White House and cannot validate them. But apparently Obama was given a sheet from Paulson summarizing the House Republican positions. McCain was supposedly silent for most of the meeting (which some Dems suggested was a "lack of leadership"; my take is that he was intently listening to all parties in the hopes of finding common ground with the House Republicans). At some point, it appears that McCain brought up the House Republican counter-proposal points, without indicating his own evaluation of their proposal. It seems like the Treasury Secretary immediately slammed the counter-proposal as nonviable, which probably did not go well with the House Republicans at the meeting. Apparently Bush's comments were to the effect that without a final bill, the economy was going down the tubes, and we didn't have time to do the bill over again. Obama assumed that he was in charge of the meeting and looked to isolate the House Republicans at the meeting by demanding to know where McCain stood on the House Republican proposals. Reportedly McCain indicated that on political principle, he preferred the implementation of House Republican approaches, because of the smaller federal footprint and exposure.
At some point, the Democrats felt they were at an impasse and decided to leave the meeting, with apparently the Treasury Secretary on bended knee pleading with them to stay the course. The Democrats seemed particularly eager to scapegoat McCain for the fact that the House Republicans were unwilling to roll over; they were heading down the home stretch and McCain's "stunt" did away with all their hard work. What a state of denial! McCain noted there never had been an agreement with the House Republicans. Pelosi, if she wanted, could get a bill passed without Republican support but that left the Democrats without political cover
Now McCain was stuck because he had pushed to get a bill passed, but the debate organization had refused his request for a postponement, and it seemed unlikely that a negotiating team (this time including an authorized House Republican) could reach an agreement in time for McCain to travel to Mississippi for the debate.
So now the Obama campaign was spreading the spin that the McCain campaign was in a downward spiral with McCain having an erratic week, having tried a desperation pass at the last minute to bolster his appeal to voters with a last-second bailout win and coming up empty.
My Take
There is no doubt in my mind that McCain was sincere. I think he should have done a better job setting expectations, and he clearly painted himself in the corner by not getting a buy-in on postponing the debate. First, getting a bill through a polarized Congress in a week's time isn't very realistic, and he had to know the Democrats had no intention of letting him use this crisis for ammunition to use against Obama. Second, being behind in the polls, he can't afford to miss the opportunity of a debate.
However, I would probably do something that McCain wouldn't. The Democrats' outrageous behavior this week, in my opinion, gives McCain a perfect out--he could announce the final result as Bush's bad bill that puts the burden on the American taxpayer, just like Bush's huge budget deficits, and he'll oppose it. The Democrats have to pass a bill. This puts McCain in a no-lose situation--if the Democrats pass the bill without his support, McCain points out the Dems passed "Bush's" bill, and Obama has spent months trying to paint McCain as Bush's third term--then the next time Obama starts up this "90% vote with Bush" nonsense, McCain can point out that Obama voted with Bush the two times it really mattered--on energy and the bailout; if the Dems negotiate with McCain, he can argue to the American taxpayer that he got them a better deal than the Dems with Bush.
