At press time, the House of Representatives had shot down a $700-billion bailout plan for the financial sector from the White House that was initially expected to pass. A revised bill was headed to the Senate, but the initial failure offers not only a political lesson, but also a communications one.
Americans are widely concerned about what the economic crisis means to their future. They are likely eager to hear about a rescue plan that will save their jobs, savings, and homes. Unfortunately, by using partisan rhetoric and inflammatory language like “Wall Street fat cats” and repeatedly referring to the Treasury's proposal as a “bailout,” Congress managed to convince voters that the bill had no benefit to them.
This led angry constituents to contact their representatives and voice their complaints about the plan. This, in turn, led to the bill getting defeated last Monday.
Lost amid the pundit pontification and political demonization was the reason why all stakeholders in Washington pursued this issue: Many believe the lack of capital in these financial institutions has very real and dire effects on an economy already heading south.
They should have drawn simple parallels between the plan and their constituents' wallets. The political failure was that House leaders couldn't keep everyone on the same script.
The general public is already doubtful about the series of rescue projects the government has embarked upon (i.e., Bear Stearns, AIG, the Fannies), so it isn't surprising that they would be suspicious of another lifeline thrown to Wall Street.
There is plenty of work afoot. A leader must emerge to convince all parties to serve as credible spokespeople who offer real, factual engagement; clear answers; and assert how the failures of financial institutions can have a ripple effect on the working economy.