Banks have lost faith in the soundness of other banks

Banks have lost faith in the soundness of other banks, so they won't lend each other money. The American people have no faith in their president and Congress, so they are carpet-bombing those same members of Congress with e-mails warning them not to support a $700 billion bailout of the banks.
The members of Congress, who don't trust the president, the secretary of the Treasury and the chairman of the Federal Reserve, and who are worried that a vote for the bailout would be political suicide a month before an election, voted the bailout down 228-205 Monday.
But make no mistake. If Congress is unwilling to pass a bailout that might restore faith in the financial markets, it will plunge the United States deeper into the abyss of the unknown.
So, yes, a $700 billion bailout would be a leap of faith. No one can guarantee that it will work. No one can honestly promise that it will free up credit or that the Treasury will get all of the public's money back if it buys up distressed securities and holds them for a couple of years while financial experts try to figure out what they are worth. Nothing is certain.
But doing nothing looks worse. Already, three Wall Street investment banks have failed, and two others will become commercial banks. The U.S. government has nationalized Fannie and Freddie. Washington Mutual has become the largest bank failure inU.S. history, and Wachovia almost followed Monday. What more evidence do the American people need?
Need it or not, they are going to get it. After the House vote Monday, the Dow plunged 780 points, the largest single-day loss in history and a 7 percent decline. The Nasdaq and S&P 500 did even worse, each losing about 9 percent.
If this kind of bloodletting continues, and more huge banks collapse, maybe the House will get the message. Our hope is that by then it won't be too late.
Maybe then the 133 Republicans, including Utah's Rob Bishop, and 95 Democrats, including Utah's Jim Matheson, who voted against the bailout will realize that they've got to stand up and vote for a plan to restore faith in the nation's credit markets. They've got to do so even if it costs them an election. They've got to do it to keep faith with the best interests of their constituents, even if those same voters don't understand that.
That's leadership. That's statesmanship. And here's the irony. That's what's been missing from the presidency and Congress, and why we're in this fix in the first place.