Main St is Stirring

Now this is fascinating; the Republicans won’t support the Paulson/Bush plan, never mind the Democrats. Why? Well part of it is straightforwardly ideological: they don’t like the ‘creeping socialism’ of the plan. But ideology melts away in times of crisis and remains merely as the dressing of something deeper.

The Republicans since Regan have pursued a populist strategy, aligning their core defence of wealth and privilege with the cultural interests of ‘the little guy’ of Middle America. So it’s been up with guns, family values, religion and a folksy image - and down with those nasty latte sipping, abortion loving, unbelieving Democrats on the Coast. They’re the elite who are selling out the country, not the big oil man who's president or indeed the former Goldman Sachs head honcho who is his Treasury Secretary.

But this morning on Radio 4 we have a series of interviews with Conservative Republicans and their staffers who tell us that they won’t support the Paulson plan because their electoral base has worked out it is an excuse for the elites to take their money and run like fuck. Michael Hudson goes all biblical about this over at Counterpunch. We don’t need to go that far. It’s an election year and the Republicans need their populist base: having turned away from elite politics they can’t put the populist tiger back in its cage. & what we’re seeing is a fascinating occurrence – the development of class politics within a right wing party and cloaked, for the moment, in right wing language and policy responses. This could break the Republicans for a generation if it gets out of hand. It may be time for me to re-read the 18th Brumaire of Louis Napoleon once again.

But it's a long way from over yet. There's a secondary game of 'pass the parcel' being played out: who takes the blame for the debt may be as important as what to do about it. It's by no means clear the Democrats have a better strategy - it's just that they haven't got such a politically toxic one as poor old Hank Paulson, once master of the universe, now reduced to going down on one knee to beg for help from Nancy Pelosi.


Oh - and yes, another huge bank has gone down.