The whole reason for the urgency is that people genuinely are concerned that a financial collapse will spark a deep recession that will cause a lot more pain in Muncie than in Manhattan. But you sure as hell wouldn’t have known that. ~Ezra Klein
It depends a great deal on who he means by “you.” If he means that a lot of the constituents burning up the Capitol phone lines were not fully aware of the negative consequences for the broader economy, he might be right, but I have to say that I’m pretty skeptical. While some outlets tried to avoid spreading panic by not describing things in the darkest terms, there seemed to be no shortage of pundits, reporters and bloggers who were quite pleased to talk about another Depression, which even the most historically illiterate would recognize as a very undesirable outcome. I don’t think I have ever seen so many references to Hoovervilles in my life as I have in the last week, so I am finding it hard to believe that most Americans were unaware of the alarmist scenarios bailout advocates were promoting. Perhaps it reassures supporters that the public turned against the plan because of poor marketing–this is, of course, a classic Bush administration response to the rejection of its bad policies. “If only we could get the sales pitch right…” has been the lament of many an administration official over the years.
Paulson and Bernanke never used language quite so outrageous, but they made it clear in their testimony that they believed this would hit everyone where they lived and hit them hard. All of the news programs did interviews with the relevant committee chairmen, and they made the same points. If so few people were aware of the worst-case scenario, how is it that Rasmussen found that 79% of respondents were somewhat or very concerned about a depression “like 1929”? Where on earth would that come from if not from the daily bombardment of fearmongering from the administration and bailout supporters? What the Rasmussen results seem to show is that the government and media have done a good job of working most of the country into a fit of tremendous anxiety and fear, and still only 45% support “taking action.” The public is actually evenly-divided on whether the government should do anything–chew on that one when considering the politics of all this. That 45% figure probably overstates support for this specific bailout, er, I mean Glorious People’s Victory Plan.
Update: John Schwenkler critiques Klein’s interpretation of poll results on the bailout.