Tuesday, September 30, 2008

Why The Bailout Plan Was Voted Down

The 700 billion dollar plan to try to save America's struggling financial industry has been rejected by politicians in the US House of Representatives. The outcome of the vote has already led to further turmoil on money markets around the world, with just about everybody less sure than ever about how the crisis is going to be resolved. But even though the Congressmen and women were under huge pressure from their political leaders to support the plan, we shouldn't be too surprised that they didn't.

It's all about self-interest. Every politician in the House of Representatives is facing re-election in just a few weeks, at the same time as the vote for the presidency. With public opinion in the US apparently set dead against the plan, with most people seeing it as a handout for greedy bankers, most of the politicians felt they couldn't support something so unpopular so close to an election. So the US administration will now have to come up with another plan. But while the talking goes on, so too does the turmoil.

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