Events in Washington are potentially momentous, but hold the applause. In late May, the Dow was at 10,300, but by mid-July it had dropped almost 2,000 points. The Nasdaq and S&P indexes are at zero gain for the past five years, as if the bubble never occurred. This slow-motion crash induced even the most obedient right-wing lapdogs to scurry aboard the Sarbanes reform bill, and the Senate passed it, 97-0. The President made two malaprop-laced pep talks to recast himself as Mr. Reformer Guy (and knocked another 500 points off the Dow). But W. is a lagging political indicator these days. Even Federal Reserve Chairman Alan Greenspan has lost his touch. For years he celebrated the new economy and refused to take any action that might have worked to curb its excesses; a bit late he tells us “irrational exuberance” was actually “infectious greed.” Now, with fear overtaking that greed in the markets and thus in Washington, the ingredients are present for an ideological sea change in American politics. But not yet.

Democrats, newly awakened to the potency of Enron-like financial scandals, are throwing smart punches at the business-friendly White House, but they are six months late to the cause (and still sound less convinced than Republican maverick John McCain). The passage of Senator Sarbanes’s legislation is meaningful, but Democratic leaders choked on the hard part–reforming stock options and giving workers a voice in managing their own pension savings. Why mess up fundraising with those high-tech companies dumping “New Dem” millions on the party of working people? Majority leader Tom Daschle, who lamely promised a vote (someday) on the stock-option issue, will be revealed as another limp corporate shmoozer if he fails to deliver. So far, the Coca-Cola directors have more courage than he. Likewise, Senator Joseph Lieberman can doubtless raise millions from Silicon Valley for his presidential ambitions by defending the corporate hogs but, if so, he should rethink which party will have him.

The Republicans are in a deeper hole, of course. If Bush wants to bring his much-touted “moral clarity” to the reform cause, he’ll have to drop the weepy speeches and dump Harvey Pitt as SEC chairman and Tom White, the Enronized Army Secretary. Then Bush should take his own medicine and come clean, open the secret SEC records of his insider cashout as a director of Harken, and do the same for the SEC investigation of Vice President Cheney’s stewardship as CEO of Halliburton. Republican zealots and their attack-dog newspaper, the Wall Street Journal, exhausted the nation with their pursuit of the Clintons on Whitewater. Stonewalling by the Bush White House promises to make these far more serious financial matters a permanent theme of the Bush presidency.

The reforms currently in motion are a good start, but no more, as William Greider notes on page 11. We know what to expect from the Republicans–stubborn maneuvering and guile designed to stall real change until (they hope) the stock market turns around and public anger subsides. But Democrats have a historic opening far greater than this fall’s elections–the opportunity to revive their role as trustworthy defenders of the folks who have always been the bone and sinew of the party, the people who do not get stock options and who deserve a much larger voice in Washington. If Democrats take a pass on the facts before them, they deserve our scorn. If they find the courage to break out of the corporate-money straitjacket and once again speak for the public, this could be the beginning of something big.