Bush Sees the Dark Days

With his somber speech to the American public tonight, George W. Bush put himself personally in the middle of the financial crisis after delegating its handling to Treasury Secretary Hank Paulson and Federal Reserve Chairman Ben Bernanke.

It was a Bush we haven't seen much of in the last seven a half years. He didn't try to hide how ugly the situation was. He said things like "our entire economy is in danger" and "America can slip into a major panic." Bush warned that a recession awaits the country without the rescue package. (To read a transcript, click here.)

With just four months left in his presidency, the crisis on Wall Street threatens to severely damage Bush's legacy. Bush knows it's his face making the sale and it will be him in meetings tomorrow crafting the final deal. As with all things presidential, the buck stops here.

Bush made an effective case that something needs to be done and the costs of inaction are too high. He also set up his legacy as a big-government conservative who oversaw an extraordinary expansion of government, from the Department of Homeleand Security to Medicare prescription drug entitlements and now to a massive government intervention in the market.

The evening's speech had echoes of Bush's September 2003 address asking Congress for $87 billion to finance the Iraq war. The sum was considered staggering at the time and marked a reversal of the administration's claims that Iraqi oil revenue would pay for the war. That figure seems almost quaint in light of the $700 billion the administration says is needed for the financial bailout.

The speech was more effective tonight because he had both Democrats and Republicans acknowledging that something needs to be done. But the no one really knows what the final bill will be or even if the plan will achieve its intended effect of soothing the market. (For more on the financial crisis, get full coverage here.)

He talked to the nation from the East Room of the White House on an extraordinary day, one where Republican presidnetial nominee John McCain suspended his campaign, saying he wanted to be in Washington to work on the crisis full time. Bush, speaking from The White House, warned that a recession awaits the country without the rescue package.

Acknowedging that the plan is in trouble, Bush conceeded to Democrats many of the points they've made in recent days including the need for congressional oversight of any bailout and denying a "windfall" to executives whose firms are bailed out.

Despite the tension in congressional hearings the last two days where Bush's economic team tried to sell the administration's package, the signs in Washington still point towards some kind of deal. House Speaker Nancy Pelosi and her Republican counterpart, John Boehner, said progress was being made and multiple reports from Capitol Hill indicate that the relevant committees in the House and Senate are making progress.

Whether a deal can be sold to a skeptical Congress remains to be seen and there*'s no guarantee that McCain will show up in Mississippi for Friday night's scheduled debate. The debate, which will center on foreign policy, was long considered to be a prime opportunity for McCain to show his national security credentials. McCain suggested to Barack Obama that they both return to Washington and they postpone the debate.

Obama is returning to Washington, where he, McCain, and congressional leaders will meet with Bush on Thursday. But the Democrat still wants to debate.

The economic crisis has not only scrambled the presidential race and sent Washington into overdrive but it's led to a party's nominee vowing to sit out the campaigning unless a financial rescue package is passed. A week ago that plan didn't even exist.

Matt Cooper

Photo caption: President George W. Bush boards Air Force One at John F. Kennedy International Airport in New York, September 24. Photo by Jim Young/Reuters /Landov.

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