Clarity
September 30, 2008 – 10:53 am by BHWhy the vote on the Paulson Plan failed, from Dani Rodrik:
It is so obvious that I am puzzled why no-one is talking about it. If so many House members voted against the plan so as not to run afoul of their local constituents, it must be the case that those constituents are not feeling the crisis in their pocketbook (yet), that they are not nearly as panicked about the situation as most economists are, that they are simply unconvinced that drastic measures are called for–or some combination thereof. A corollary is that Washington, New York, and the economist community collectively have not been able to tell a convincing story about how badly all this will turn out to be for Main Street. All the talk about the credit crunch and collapse in retirement savings remains apparently too abstract for most people.
