UPDATE 2: No Good! Start Over! TARP Rejected in the Hizzouse!

Let’s hope they start from scratch anyways.  (Some of my thoughts on why they need a new bill from scratch here)

Globe and Mail (“Canada’s National Newspaper“!) story here.

There’s no doubt that one will be passed eventually, and the credit and stock markets will be frozen until they either announce the TARP, or until they announce there won’t be one…

Sounds like Republicans were the ones that kept this bill from passing (thank you, Republicans!).  I’ve noticed many commentators, more on the politics than the econ side, who speak about how many are unwilling to vote for this bill because they are concerned about damaging their re-election chances in November as if that’s a bad thing.  I’d say that’s the BEST thing about this bill:  It is forcing our leaders to operate with our opinion in mind.  They’re actually listening to their constituents rather than the corporate donors that would invariably benefit from any manifestation of the TARP!  This is a VICTORY for Democracy and I’m surprised so many see it as some sort of awful manifestation of political calculation.

That people, by and large, HATE this bill is not because they don’t believe the financial circumstances are perilous.  It’s because they see this bill as just another opportunity to take advantage of a stunned electorate to rob the nation to reward the rich, while eradicating none of the systemic problems that caused this crisis to arise, or reducing the odds that another crisis won’t arise shortly after. (UPDATE: Krugman’s latest article suggests that he expected that even had the TARP passed, we would still be looking down the barrel of future crises)

Congratulations to all those who fought this bill (I’m looking at you, Mish) and congratulations to the Members of the House from both parties that voted against this bill (regardless of the political calculations that were involved).  YOU DID YOUR JOB AND LISTENED TO YOUR CONSTITUENTS! I just wish you did it more often.

(Full disclosure:  I say this as an owner in shares of JPM.  I would have, without a doubt, made some cash if the TARP did pass.  But I’m much happier that it didn’t)

UPDATE 2:

Mish lists to an article in SFGate entitled “Many vulnerable lawmakers said ‘no’ to bailout” which goes into a bit more depth about which members of the House voted against the will of their constituents in support of the bill.

… and the cow goes moo (suck it, Paulson!)