Week In Politics Reviewed

ROBERT SIEGEL, host:

Joining us to talk about the bailout, last night's vice presidential debate and possibly other matters are our regular political commentators, E.J. Dionne of the Washington Post and David Brooks of The New York Times. Welcome to both of you.

Mr. DAVID BROOKS (Commentator, The New York Times): Thank you. Good to be with you.

SIEGEL: I should say that David is with me in Washington. E.J., you're in Chicago today.

Mr. E.J. DIONNE (Commentator, Washington Post): I am, indeed.

SIEGEL: Well, here's the first question. David, the president's plan has passed but did so after failing. And it passed with most of his own party voting against it. Shall we score one for bipartisanship or for an extremely weak president?

Mr. BROOKS: Well, score one for the markets. I think what we've learned this week again and again is that markets are more powerful the governments. You had 5o members of the house who voted against this thing and then the markets went down 777 points and more, and the people revolted and said, hey! Fix our markets. And so you had 50 members of the house retreating. And I think what you saw was in some sense the strength of the markets and also, let's face it, a compromise in free market principles. When you have a social contagion like this, the government's got to do something. And pure free market theory which posits some rational individualists who are responding to incentives has no room for social contagions.

SIEGEL: But E.J., a part of what happened in between also was, the package was sweetened with a great number of tax extensions.

Mr. DIONNE: Indeed it was. I think the answer to your question is you have bipartisanship and a very weak president at the same time. It was easier for some Republicans to vote for this because of a whole lot of tax cuts that were added to it, and also, I think it was actually important that they added this provision increasing the amount of ensured deposits from 100,000 to 250,000. That won a lot of members who've been hearing from their local bankers. But I think it was fear. Fear motivates people a lot in politics. And people were starting to hear the phone calls switch.

Before, the calls were from people who were really mad about bailing out Wall Street. After, the calls were from businesspeople saying, I can't get a loan. I'm having to lay-off people. I can't order cars for my dealership. McDonald's franchises having trouble getting loans. There was a sense that the system really was freezing up. And so members who might have felt the political winds go one way suddenly felt them shift after a lot of bad things happened and not just the drop in the market.

SIEGEL: Talk about shifting. I mean, do you think that all that's happening in Washington in this season and in the economy represents just a big hiccup in what remains a consensus policy about markets and regulation or do you feel some shifting, David, of the tectonic plates of ideology beneath us here?

Mr. BROOKS: I think we're seeing a fundamental shift. We've had a conservative era from say, 1980 2006. That era is over. The question is what comes next. And I think what comes next is what you might call corporate progressivism. And what we saw now is really the financial establishment taking control. And on the Democratic side, that's people like Robert Rubin. On the Republican side, people like Paulson. And it's not traditional liberalism but it's using, it's protecting corporations, it's protecting the markets. But using some money for some progressive means so it's not pure liberalism but corporate progressivism, I think.

SIEGEL: E.J., do you agree with that?

Mr. DIONNE: I think I would call it something like neo-New Dealism because what you're seeing is the government is intervening to buy $700 billion worth of bonds. The government is going to get some ownership share when they buy some of these bonds. The government is being called upon to do something about people's mortgages. You have not had this level of demand for government activity since the 1930s. I'm not sure it's going to be only corporatism as David suggests, although I agree with him on the trend. I do think that the period of a triumphant and almost Utopian market ideology is over and and we're getting back to a very American tradition of mixed economy where government plays a major role in a market economy.

Mr. BROOKS: We've outsourced our government to Goldman Sachs, I think that's the bottom line.

Mr. DIONNE: God save us all.

SIEGEL: Now, the Biden-Palin debate from last night. In the debate, Joe Biden's line of attack was familiar. In his view, John McCain's no maverick. He's a continuation of the Bush administration.

Senator JOE BIDEN (Democrat, Delaware; Vice Presidential Candidate): He has been no maverick on the things that matter to people's lives. He voted four to five times for George Bush's budget, which put us a half a trillion dollars in debt this year and over three trillion dollars in debt since he's got there. He has not been a maverick in providing health care for people.

SIEGEL: And when Biden talked about the Bush record, Sarah Palin didn't necessarily say that was wrong, just irrelevant.

Governor SARAH PALIN (Republican, Alaska; Vice Presidential Candidate): Oh, say it ain't so, Joe. There you go again pointing backwards again. You prefaced your whole comment with the Bush administration. Now doggone it, let's look ahead and tell Americans what we have to plan to do for them in the future. You mentioned education and I'm glad...

SIEGEL: David Brooks, what do you make of that, doggone it?

Mr. BROOKS: You betcha. I thought both candidates actually had a pretty good night. Biden and Obama are ahead so he projected a sort of calm expertise, did that very well, a very humane performance. He laughed at himself. McCain and Palin are behind. So what was their strategy? It was the strategy to say, A, we're different than Bush, Bush is some curiosity from the distant past.

SIEGEL: Yeah. President who? George who?

Mr. BROOKS: And then to show they're different from Washington and if Palin did nothing else, she cut herself off from Bush, which she had to do. And believe me, she showed she's different from Washington. So I thought they both had an intelligent strategy and they both performed it reasonably well and the bottom line is Palin didn't crater. That's the big story.

SIEGEL: E.J. Dionne, your judgment of the debate?

Mr. DIONNE: Well, she made George Bush sound like he were Millard Fillmore or somebody like that, that we don't think about anymore. I was talking today to the Ohio Democratic Chairman Chris Redf and he said it perfectly, she did very well answering the questions she asked herself. She did a very clever thing. She set expectations so low in those Katie Couric interviews, that she was bound to exceed them. And she did. And a lot of Republicans were relieved that she didn't fall apart. I didn't think she was going to fall apart. She's debated before. But there were just a lot of words that kept coming out. I think if you ask the question, who's ready to be president, who understood the problems he was talking about?

Most people, according to the polls, suggested it was Joe Biden and I think one of the most significant of those instant polls is about 40 some percent said Palin's ready to be president. About 80 percent said that Biden's ready to be president. On the politics, I agree with David. This is moving in Obama's direction right now. And nothing that happened last night shook that up. I think after that debate, it continues to move in Obama's direction.

SIEGEL: I just want to actually follow up on that point with David. There has been a tremendous number of polls coming out over the past few days showing movement toward Obama, nationally, tracking polls, state polls. What do you make of polls that are a month or five weeks away from election day? Are we getting serious here about what's likely to happen in November or is it still very fluid?

Mr. BROOKS: No, I don't think it's fluid. I think we're getting serious. It's hard to see it turning around. I thought it would happen, but in the last two weeks, but I think the financial crisis has accelerated the public shift. McCain has not helped himself with his erratic behavior. Obama has really helped himself by being steady and most importantly by surrounding himself by Warren Buffet and Robert Rubin and Larry Summers. He has seemed much the safer candidate and I think that's accelerated a shift that I think probably would have happened anyway.

SIEGEL: David Brooks and E.J. Dionne, thanks to both of you.

Mr. BROOKS: Thank you.

Mr. DIONNE: Thank you.

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