US Congress Approves Huge Government
Rescue Plan For Financial Sector
In a 263-171 vote, the U.S. House of Representatives has approved a measure aimed at rescuing U.S. financial markets, just days after rejecting a previous version and sending stock markets reeling. Democratic and Republican leaders were able to sway a sufficient number of opponents to vote yes on the legislation, which is considered an imperfect but necessary short-term effort to address the financial crisis.
Nobody in the House wanted a repeat of the negative House vote last Monday that triggered the largest ever single closing point loss on Wall Street, which helped spur the Senate to adopt a revised version in a 74-25 vote on Wednesday.
In floor debate in the House on Friday, supporters, including House members who previously opposed the measure, referred to the dangers of inaction and potential ripple effects through the economy, while others underscored their continuing opposition.
Contrasting views among Republicans came from Representative Zach Wamp of Tennessee, and fellow Republican Devin Nunes of California.
"I have been listening to small business people all week long, and they said, 'thanks for voting no on Monday, and thanks for standing up for us, but you have to do something.' Congress has to act. We're out of options," Wamp said.
"This is not a time for panic; it's a time for leadership, and it's a time for deliberation," Nunes countered. "Congress must not be confined to a timetable, dictated by alarmists, who see the government money as their only backstop against irresponsible lending."
Republicans Marilyn Musgrave and Ginny Brown-Waite expressed the view still held by many Republicans that the legislation would not be effective, and does more to help Wall Street than average Americans.
"Some things have changed in this bill, but taxpayers will still be picking up the tab for Wall Street's party," Musgrave said.
"This is not a bill I believe I can vote for on behalf of my constituents," Waite said.
Greatly expanded from the Bush administration's original three page proposal, and including $150 billion in tax breaks for alternative energy added by the Senate, the legislation authorizes as much as $700 billion for the government to buy up devalued mortgage-backed and other securities from stressed financial firms.
Other points include a strong oversight board, steps to avert further home foreclosures, limiting large pay outs to executives, who leave firms involved in the plan, increasing federal insurance for bank accounts to $250,000, and steps to allow taxpayers to recover losses.
Democrats voiced similar views.
"Today, it's about protecting Main Street not Wall Street," said Ron Kind of Wisconsin. "It's about protecting the American taxpayer, not CEO (Chief Executive Officer) salaries."
House Speaker Nancy Pelosi and Republican minority leader John Boehner said the measure does what is necessary to forestall further economic damage.
"The urgency is clear. We hear it from our friends and our neighbors. We hear it every place we turn," Pelosi said.
"The American people sent us here to do our jobs on their behalfs. They're counting on us," Boehner added.
After approval by Congress and President Bush, Treasury Secretary Henry Paulson will be clear to set in motion complex actions to ease pressures on the financial system and credit markets.
House Democrats have pledged further aggressive action on financial market reforms when lawmakers return in 2009, with either Democrat Barack Obama or Republican John McCain in the White House.
While approval of the bill marked a final major action by the House before adjournment, congressional committees will hold a series of hearings examining the causes of the financial crisis and the collapse of key firms such as Lehman Brothers and American Insurance Group (AIG).