economic bailout deal crashed

[fire_mat99]

WASHINGTON — If you want to understand why the carefully crafted economic bailout deal crashed and burned on the House floor Monday, look no further than the Houston-area congressional delegation.

Eight of the region's nine representatives — ranging from some of the most liberal in the Congress to the most conservative — rejected last-minute pleas from President Bush and each party's leadership to approve a plan that evoked more anger than loyalty, even among its supporters.

To a person, the lawmakers said that as much as they fear a potential downturn in the economy, they rejected what they saw as a flawed plan that would reward the people most responsible for the nation's economic ills.

"Today, I stood victorious with the American people and voted no to defeat the Wall Street 'Fat Cat' bailout," said Rep. Ted Poe, R-Humble, an early and vociferous foe of the $700 billion bailout sought by Bush. "The government has no authority to force American taxpayers to ante up a $700 billion ransom to save the hides of the rich robber barons on Wall Street."

From the left, Rep. Sheila Jackson Lee, D-Houston, said she balked at the deal because it represented "an unprecedented and unabridged power shift" to the Treasury secretary that left ''Mr. and Mrs. Main Street" on the curb.

"I was not prepared to transfer so much power to the secretary of the Treasury, even as hard as the Democratic leadership worked to fix the administration's plan," Jackson Lee said.

In the end, 23 of Texas' 32 House members voted against the measure, which was defeated by a surprisingly wide margin, 228 to 205. The only Houston-area lawmaker to support the ill-fated deal was Rep. Kevin Brady, R-The Woodlands, a member of the influential House Ways and Means Committee.

"With all their bad decisions, I don't give a flip about Wall Street," said Brady, a sixth-term congressman. "But as much as I detest this bill, doing nothing is worse. I couldn't responsibly stand by and let this financial virus spread to families and small businesses in Southeast Texas communities, risking their jobs or their bank accounts."

With the Dow Jones stock index dropping a record 777.68 points after the bill's collapse, Texas lawmakers predicted Congress would return to the nation's capital later this week to resume efforts to approve a revised package.

Rep. Michael McCaul, R-Austin, said House rejection of the leadership's deal cleared the way for lawmakers "to work day and night until we reach (a) solution" that puts less of a financial burden on taxpayers.

''In a capitalist system," he said, "people are held responsible for their decisions. They don't dump bad debt on the public."

But McCaul's opponent, Houston lawyer Larry Joe Doherty, attacked the incumbent for doing "nothing to help solve this problem." Doherty said, "We need a real financial security plan that would benefit Main Street and protect working families."

In the Houston area's contested congressional races, the rivals found themselves united in opposition to the bailout. Rep. Nick Lampson, D-Stafford, locked in a tight re-election fight with GOP challenger Pete Olson, said he opposed the bipartisan proposal because it showed that Congress was ''out of touch" with Americans.

"The solutions to the financial crisis need to focus on the people who are victims of it, not the executives on Wall Street who are responsible for it," Lampson said.

Olson told the Houston Chronicle that he, too, would have rejected the deal because it was "a rushed effort" that would have put American taxpayers "on the hook."

Rep. Gene Green, D-Houston, like Lampson, pointed to the plight of Texans trying to recover from Hurricane Ike as Treasury Secretary Henry Paulson was asking Congress to bankroll Wall Street's attempted recovery. Green said it would be a hard sell in his district to burden hurricane victims with an appeal to help multibillion-dollar financial institutions.

Rep. John Culberson, R-Houston, said the measure forced Americans "to choose between bankrupting our children or big Wall Street banks." He added, "I will not vote to bankrupt future generations to protect Wall Street investment banks from their own mistakes."

Democrat Michael Skelly, Culberson's challenger in November, said the proposal was "woefully insufficient in addressing the systemic problems in our financial markets."

Sen. John Cornyn, R-Texas, who is seeking a second six-year term in November, was a rare voice of optimism amid anger. He said he hoped that House rejection of the plan "signals the beginning and not the end of a bipartisan effort by Congress to strengthen the economy."

"Simply doing nothing is not an option," he said.

http://www.chron.com/disp/story.mpl/business/6031220.html

[fire_mat99]

What do you think should they do it or not?

If they do it they may blame the gov for trying to control the free-market.And more people will move to the right.

[fire_mat99]

Lobbying is intense as bailout vote nears


http://www.baltimoresun.com/news/local/bal-te.md.cummings03oct03,0,3543730.story

WASHINGTON - At times yesterday, the telephone calls into the Capitol Hill office of Rep. Elijah E. Cummings merged into a single, constant ring.

And with a House vote possible today on the $700 billion financial rescue package approved by the Senate, the Baltimore Democrat was hearing from both sides.

After meeting last night with his fellow House Democrats, he said he was still "wrestling" with his vote.

"We're still trying to make sure that there's clarity with regard to helping people who are facing foreclosure," said Cummings, who voted against a bailout earlier this week. "That's a major issue."


Dozens of House members were feeling the squeeze yesterday as a furious lobbying effort for the bailout by President Bush and congressional leaders was met by a tidal wave of telephone calls and e-mails from the public urging lawmakers to vote it down.

"Number one, where are we going to get $700 billion?" asked Michael Butkus, a professional musician who called Cummings from Upper Marlboro. "We're broke."

The plan to help the nation's financial markets by using public funds to buy bad mortgages and other toxic debt has drawn voter reaction at a level ordinarily associated with such hot-button issues as immigration or the war in Iraq. More than 600 callers contacted Cummings this week, with sentiment running 3 to 1 against a bailout.

"I've never seen this high a volume, or this high a passion," Harrison Wadsworth IV, the staffer responsible for answering the telephone in Cummings' office in the Rayburn House Office Building, said between calls. "I've been tied up all day."

Conservative House Republicans joined with liberal Democrats on Monday to reject an earlier version of the rescue plan. Cummings is attracting attention because of his "no" vote. While callers have made their opposition clear, Sen. Barack Obama, the Democratic presidential nominee, and others have sought his support for the version approved Wednesday by the Senate.

That bill includes more than $100 billion in tax breaks and other enticements intended to attract Republican votes to what leaders on both sides hope will be bipartisan passage. It's those additions that spurred Robert Mitzel, a retired pastor from Catonsville, to call Cummings.

"I guess I have no objection to the government trying to help out, but this new bailout bill looks to me like it's just bribery," said Mitzel. "Here Congress takes my money to bribe some Republicans so they'll vote for this thing."

The Senate version also expands federal insurance on bank deposits, which had been sought by House members of both parties. Despite Mitzel's misgivings, the changes appeared to increase support; a handful of members said yesterday they would now support the legislation.

Whether there will be enough support to reverse Monday's 228-205 vote remained unclear. House Majority Leader Steny H. Hoyer said yesterday that he would not bring a bill back to the floor unless he were sure it had the votes to pass.

"We have no intention of failing again," the Southern Maryland Democrat said. "That would have, I think, a very negative impact on the markets and on confidence in the markets."

Hoyer said opposition among callers to his office had fallen from 6-to-1 before the House vote Monday to 3-to-1 after.

"We've still got great apprehension, but you can see in 72 hours we've halved the numbers," he said. "I think on this kind of issue, there's opposition because there's not full understanding. And there's not assurance that this is going to work.

Hoyer agreed that there are no guarantees, but he said that without congressional action, "the situation will get much worse."

Back in Cummings' office, as Wadsworth juggled calls, nine men and women wearing yellow T-shirts demanding "Stop loan sharks" crowded in. Ashidda Khalil, the Baltimore director of the Neighborhood Assistance Corp. of America, said the group was visiting all Maryland House members to register its opposition. "There's nothing in it for the homeowners," she said. "We're saying no to Wall Street. Look out for Main Street."

Cummings himself has expressed similar sentiments. He spoke of a conversation yesterday with a neighbor who is going into foreclosure.

"He said, 'I don't want a handout, I just want to restructure my loan,'" Cummings said. "He asked me what was in the package for him."

Cummings said he has been gathering assurances from House Speaker Nancy Pelosi, from House Financial Services Committee Chairman Barney Frank and from Obama, should he become president, that homeowners such as his neighbor would be able to seek relief.

"Since we don't know about the Wall Street piece and whether it's going to work," he said, "we have to make sure there's a Main Street piece that has some effect."