The lower house of the US Congress has voted down a $700bn (£380bn) plan aimed at bailing out Wall Street.

The rescue plan, a result of tense talks between the government and lawmakers, was rejected by 228 to 205 votes in the House of Representatives.

About two-thirds of Republican lawmakers refused to back the rescue package, as well as 95 Democrats.

Shares on Wall Street plunged within seconds of the announcement, after earlier falls on global markets.

A White House spokesman said that President George W Bush was “very disappointed” by the result.

A US Treasury spokesman said that Mr Bush, Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke would meet to discuss the way forward.

http://news.bbc.co.uk/1/hi/business/7641733.stm

I was surprised by the extent of the Republican rebellion on this. Is this a principled defense of free-market ideals and is it one which trumps national self-interest? Obviously many other factors may be in play here. Even so, it’s an interesting counter-example to the kind of reductive critique of free-market economics that explains it away as a rhetorical tool of capitalists.

This is not an either/or thing: it would be a mistake to counterpose the ‘genuine’ beliefs of those Republican rebels who’ve defended these principles against the false/dishonest believers who’ve abandoned their principles out of self-interest. The beliefs people adopt and the stands they’re willing to take intersect with the social relationships they find themselves embedded within and the personal projects they self-interestedly pursue through them. A properly realist approach to understanding political beliefs, what they mean and why they form, requires that we avoid reductive explanations and try and understand the structure of people’s beliefs from the inside. Normative assessment of them should not inform the process of understanding and reductive explanations frequently smuggle them in in a way that precludes our properly understanding what people believe and what those beliefs mean to them. We can then engage with this understanding in a normative way but the question of why people believe what they do is logically distinct from of our appraisal of them. This is a methodological claim, rather than any sort of metaphysical one: it’s not claiming the fact/value distinction but simply saying that unless we’re careful excessive value-commitments can undermine particular factual inquiries.