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House Approves Deal - 10/03/08 01:21 PM
House Approves $700B Financial Rescue Package
President Bush Signs Bill Into Law Same Afternoon
In a dramatic reversal, the House today approved by a comfortable margin a $700 billion financial rescue package that will bring the greatest intervention of the federal government into the private marketplace since the Great Depression, attempting to prevent the economy from sliding into a deep recession.
Just four days after the bill's initial demise sparked a free fall on Wall Street, the House approved the legislation 263-171. At 1:23 p.m., the measure cleared a majority of votes, and the chamber broke out in applause.
After initially rejecting the bill by a 2-to-1 margin, House Republicans mustered 91 votes in favor of it on the second try, with 172 Democrats supporting its passage. One hundred eight Republicans and 63 Democrats voted against the bill. The Senate approved the package Wednesday...
"By coming together on this legislation, we have acted boldly to prevent the crisis on Wall Street from becoming a crisis in communities across our country," Bush said in a statement at the White House. He said the bill's provisions "represent decisive action to ease the credit crunch that is now threatening our economy."
Bush acknowledged that some Americans "have concerns about this legislation, especially about the government's role and the bill's cost." He added: "As a strong supporter of free enterprise, I believe government intervention should occur only when necessary. In this situation, action is clearly necessary."
He predicted that "ultimately, the cost to taxpayers will be far less than the initial outlay," because many assets the government purchases are likely to rise in value "once the market recovers."
Bush cautioned that "it will take some time for this legislation to have its full impact on our economy" and pledged that the government will "take the time necessary to design an effective program" to implement the legislation.
Formally known as the Emergency Economic Stabilization Act, it authorizes Treasury Secretary Henry M. Paulson Jr. to initiate what is likely to become the biggest government bailout in U.S. history, allowing him to spend up to $700 billion to relieve faltering banks and other firms of bad assets backed by home mortgages, which are falling into foreclosure at record rates.
The plan gives Paulson broad latitude to purchase any assets from any firms at any price and to assemble a team of individuals and institutions to manage them. In wielding those powers, Paulson and others hope to contain a crisis that has caused the failure or forced the rescue of a half-dozen major Wall Street firms and unnerved markets around the world.
The U.S. Chamber of Commerce, which represents more than 3 million businesses and organizations, hailed the vote, which it said would begin restoring the flow of credit to the economy. "With the American economy on life support, Congress took the necessary step to stop the bleeding," said R. Bruce Josten, the chamber's executive vice president of government affairs. "Today's bipartisan vote in the House is a major step toward stabilizing the credit markets and supporting Main Street businesses..."
Paulson, who first told lawmakers of the need for the legislation Sept. 18, initially sent a three-page bill to Capitol Hill seeking almost unfettered power in the rescue plan. But, in two weeks of negotiations that ensued, Democrats and Republicans modified the plan to include limits on executive compensation for firms that participate in the program, provide the government an equity position in these firms to ensure the government can recoup the $700 billion and, in a nod to Republicans, added an insurance program for those security-backed mortgages that are not in complete distress...
Over the past three days, groups as varied as AARP and the National Federation of Independent Business have organized campaigns showering hundreds of thousands of e-mails and phone calls on members of Congress to counter a wave of calls and e-mails that, before Monday's vote, was overwhelmingly opposed to a bailout. A tide of lobbyists representing corporate executives, small-business owners, farmers and retirees swamped Capitol Hill yesterday to push for the bailout, and the U.S. Chamber of Commerce also began running full-page newspaper ads highlighting what it described as a massive threat to the economy if the package is not passed...
Washington Post
Text of the Bill, if anyone cares to read it.
President Bush Signs Bill Into Law Same Afternoon
In a dramatic reversal, the House today approved by a comfortable margin a $700 billion financial rescue package that will bring the greatest intervention of the federal government into the private marketplace since the Great Depression, attempting to prevent the economy from sliding into a deep recession.
Just four days after the bill's initial demise sparked a free fall on Wall Street, the House approved the legislation 263-171. At 1:23 p.m., the measure cleared a majority of votes, and the chamber broke out in applause.
After initially rejecting the bill by a 2-to-1 margin, House Republicans mustered 91 votes in favor of it on the second try, with 172 Democrats supporting its passage. One hundred eight Republicans and 63 Democrats voted against the bill. The Senate approved the package Wednesday...
"By coming together on this legislation, we have acted boldly to prevent the crisis on Wall Street from becoming a crisis in communities across our country," Bush said in a statement at the White House. He said the bill's provisions "represent decisive action to ease the credit crunch that is now threatening our economy."
Bush acknowledged that some Americans "have concerns about this legislation, especially about the government's role and the bill's cost." He added: "As a strong supporter of free enterprise, I believe government intervention should occur only when necessary. In this situation, action is clearly necessary."
He predicted that "ultimately, the cost to taxpayers will be far less than the initial outlay," because many assets the government purchases are likely to rise in value "once the market recovers."
Bush cautioned that "it will take some time for this legislation to have its full impact on our economy" and pledged that the government will "take the time necessary to design an effective program" to implement the legislation.
Formally known as the Emergency Economic Stabilization Act, it authorizes Treasury Secretary Henry M. Paulson Jr. to initiate what is likely to become the biggest government bailout in U.S. history, allowing him to spend up to $700 billion to relieve faltering banks and other firms of bad assets backed by home mortgages, which are falling into foreclosure at record rates.
The plan gives Paulson broad latitude to purchase any assets from any firms at any price and to assemble a team of individuals and institutions to manage them. In wielding those powers, Paulson and others hope to contain a crisis that has caused the failure or forced the rescue of a half-dozen major Wall Street firms and unnerved markets around the world.
The U.S. Chamber of Commerce, which represents more than 3 million businesses and organizations, hailed the vote, which it said would begin restoring the flow of credit to the economy. "With the American economy on life support, Congress took the necessary step to stop the bleeding," said R. Bruce Josten, the chamber's executive vice president of government affairs. "Today's bipartisan vote in the House is a major step toward stabilizing the credit markets and supporting Main Street businesses..."
Paulson, who first told lawmakers of the need for the legislation Sept. 18, initially sent a three-page bill to Capitol Hill seeking almost unfettered power in the rescue plan. But, in two weeks of negotiations that ensued, Democrats and Republicans modified the plan to include limits on executive compensation for firms that participate in the program, provide the government an equity position in these firms to ensure the government can recoup the $700 billion and, in a nod to Republicans, added an insurance program for those security-backed mortgages that are not in complete distress...
Over the past three days, groups as varied as AARP and the National Federation of Independent Business have organized campaigns showering hundreds of thousands of e-mails and phone calls on members of Congress to counter a wave of calls and e-mails that, before Monday's vote, was overwhelmingly opposed to a bailout. A tide of lobbyists representing corporate executives, small-business owners, farmers and retirees swamped Capitol Hill yesterday to push for the bailout, and the U.S. Chamber of Commerce also began running full-page newspaper ads highlighting what it described as a massive threat to the economy if the package is not passed...
Washington Post
Text of the Bill, if anyone cares to read it.
