Luntz triumphant

Just how tightly are Republicans clinging to Frank Luntz's argument that they should portray the $50 billion fund in the current version of financial reform as a permanent bailout? On his Sunday appearance on CNN's "State of the Union," Sen. Mitch McConnell (R-Ky.) used the word "bailout" five times, including once in this exchange.

CROWLEY: But that bailout is funded by the banks themselves, is it not? It is not a taxpayer bailout?

MCCONNELL: Well, Robert Reich, who was Bill Clinton's secretary of labor, says it is a bailout fund.

The Reich reference comes from here -- in a column about how Republicans were goosing the debate over financial reform, based on Frank Luntz's memo. The bill, writes Reich, "preserves the possibility that the Fed could launch another bank bailout," in the sense that it doesn't, say, ban bailouts. But Reich goes on:

[T]he Street thinks the Dodd bill goes way too far, and wants its Republican allies to water it down with more loopholes, studies, and regulatory discretion. Republicans figure they can accommodate the Street by refusing to give the Democrats the votes they need unless the Democrats agree to weaken the bill -- while Republicans simultaneously tell the public they're strengthening the bill and reducing the likelihood of future bailouts.

The success of McConnell's push depends, I think, on how often Republicans say this without getting follow-up questions. So far they've been getting a lot of follow-ups -- the reliance on this talking point is just so obvious.

Here's the memo, for future reference.

Language of Financial Reform -