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Madam Speaker, when was the last time someone asked you for $700bn? ..
It is a number that is staggering, but tells us only the costs of the Bush administration's failed economic policies: policies built on budgetary recklessness, on an anything-goes mentality, with no regulation, no supervision, and no discipline in the system.
Democrats believe in the free market, which can and does create jobs, wealth, and capital. But left to its own devices, it has created chaos.
That chaos is the dismal picture painted by Treasury Secretary [Henry)] Paulson and Federal Reserve Chairman [Ben] Bernanke a week and a half ago in the Capitol. As they pointed out, we confront a crisis of historic magnitude that has the ability to do serious injury not simply to our economy but to the American people; not just to Wall Street, but to everyday Americans on Main Street.
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It is our responsibility today, to help avert that catastrophic outcome. Let us be clear: This is a crisis caused on Wall Street. But it is a crisis that reaches to Main Street in every city and town of the United States.
It is a crisis that freezes credit, causes families to lose their homes, cripples small businesses, and makes it harder to find jobs. It is a crisis that never had to happen. It is now the duty of every member of this body to recognise that the failure to act responsibly, with full protections for the American taxpayer, would compound the damage already done to the financial security of millions of American families.
Over the past several days, we have worked with our Republican colleagues to fashion an alternative to the original plan of the Bush administration.
I must recognise the outstanding leadership provided by [the chairman of the House financial services committee and Democrat of Massachusetts] Barney Frank, whose enormous intellectual and strategic abilities have never before been so urgently needed, or so widely admired.
I also want to recognise [Illinois Democratic Republican] Rahm Emanuel, who combined his deep knowledge of financial institutions with his pragmatic policy experience to resolve key disagreements.
Secretary Paulson deserves credit for working day and night to help reach an agreement, and for his flexibility in negotiating changes to his original proposal.
Democrats insisted that legislation responding to this crisis must protect the American people and Main Street from the meltdown on Wall Street.
The American people did not decide to dangerously weaken our regulatory and oversight policies. They did not make unwise and risky financial deals. They did not jeopardise the economic security of the nation. And they must not pay the cost of this emergency recovery and stabilisation bill.
So we insisted that this bill contain several key provisions. This legislation must contain independent and ongoing oversight to ensure that the recovery programme is managed with full transparency and strict accountability.
The legislation must do everything possible to allow as many people to stay in their homes rather than face foreclosure.
The corporate CEOs whose companies will benefit from the public's participation in this recovery must not benefit by exorbitant salaries and golden parachute retirement bonuses.
Our message to Wall Street is this: the party is over. The era of golden parachutes for high-flying Wall Street operators is over. No longer will the US taxpayer bail out the recklessness of Wall Street. The taxpayers who bear the risk in this recovery must share in the upside as the economy recovers.
And should this programme not pay for itself, the financial institutions that benefited, not the taxpayers, must bear responsibility for making up the difference.
These were the Democratic demands to safeguard the American taxpayer, to help the economy recover, and to impose tough accountability as a central component of this recovery effort.
This legislation is not the end of congressional activity on this crisis. Over the course of the next few weeks, we will continue to hold investigative and oversight hearings to find out how the crisis developed, where mistakes were made, and how the recovery must be managed to protect the middle class and the American taxpayer.
With passage of this legislation today, we can begin the difficult job of turning our economy around, of helping those who depend on a growing economy and stable financial institutions for a secure retirement, for the education of their children, for jobs and small business credit.
Today we must act for those Americans, for Main Street, and we must act now, with the bipartisan spirit of cooperation which allowed us to fashion this legislation.
This not enough. We are also working to restore our nation's economic strength by passing a new economic recovery stimulus package, a robust, job-creating bill that will help Americans struggling with high prices, get our economy back on track and renew the American dream.
Today we will act to avert this crisis, but informed by our experience of the past eight years, with the failed economic leadership that has left us less capable of meeting the challenges of the future.
We choose a different path. In the new year, with a new Congress and a new president, we will break free with a failed past and take America in a new direction to a better future..
John Boehner, the Republican minority leader, called the measure "a mud sandwich" but urged members to reflect on the damage that a defeat of the measure would mean "to your friends, your neighbors, your constituents" as they might watch their retirement savings "shrivel up to zero."
Sixty-five Republicans joined 140 Democrats in voting for the measure, while 133 Republicans and 95 Democrats voted against it. "The legislation has failed," Speaker of the House Nancy Pelosi said at a news conference after the vote. Some Republicans seemed to blame Pelosi's speech from the floor, which attacked Bush's economic policies, for the defeat.
Defying President Bush and the leaders of both parties, rank-and-file lawmakers in the House on Monday rejected a $700 billion economic rescue plan in a revolt that rocked the Capitol, sent markets plunging and left top lawmakers groping for a resolution.
The stunning defeat of the proposal on a 228-205 vote after marathon talks by senior Congressional and Bush administration officials lowered a fog of uncertainty over economies around the globe. Its authors had described the measure as essential to preventing widespread economic calamity.
The markets began to plummet even before the 15-minute voting period expired on the House floor. For 25 more minutes, uncertainty gripped the nation as television showed party leaders trying, and failing, to muster more support. Finally, Representative Ellen Tauscher, Democrat of California, pounded the gavel and it was done.
Radical bailout plan has a jawdropping price tag
Radical bailout plan has a jawdropping price tag, ... and other assets of nearly a thousand failed S ... FBI investigating companies at heart of meltdown; Jimmy Carter says bailout ...
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Cached
Radical bailout plan has a jawdropping price tag
... Bush administration on Friday laid out a radical bailout plan ... real estate and other assets of nearly a thousand failed ... Related Interactive. Wall Street Meltdown AP
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Radical bailout plan has a jawdropping price tag: Financial News ...
Radical bailout plan has a jawdropping price tag. - WASHINGTON (AP) -- Struggling to stave ... mortgages, foreclosed real estate and other assets of nearly a thousand failed S&Ls ...
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Cached
Will the Government Bailout Work?
... Wall Streeter explains the latest Treasury-Fed-SEC plan ... the mainstream business media were SHRIEKING that meltdown ... floors yesterday, which indicated this proposed bail out of ...
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Bailout plan may cost a half-trillion or more
... off financial catastrophe, the Bush administration on Friday laid out a radical bailout plan ... mortgages, foreclosed real estate and other assets of nearly a thousand failed S&Ls ...
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Many vulnerable lawmakers said 'no' to bailout
... on Election Day rather than follow their party leaders and vote for an unpopular economic bailout plan. ... that, he suggested, with the $500,000 limit on compensation packages for executives of the failed companies that would participate in the bailout ...
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Source: San Diego Union-Tribune
NewsDateTime: 1 hour ago
White House, lawmakers to seek new bailout deal
... and White House officials, stunned when the House rejected a massive rescue plan for the nation's economy, scrambled to structure a new bailout ... President Bush makes remarks on the failed bailout Monday. (AP) ...
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Source: Chicago Sun-Times
NewsDateTime: 1 hour ago
Rep. Van Hollen On Bailout
Discussing the record session on Wall Street yesterday as Congress failed to pass the bailout plan, with Robert Doll, Bl. ... World stocks fell to near three-year lows on Tuesday but fears of a major meltdown following historic Wall Street ...
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Source: CNBC
NewsDateTime: 2 hours ago
Late-night hosts crack wise about bailout
Along the way, they also had a woebegone baseball team and a market meltdown in their sights. ... host Conan O'Brien reminded viewers that "earlier today the House of Representatives failed to get enough votes to pass the Wall Street bailout plan.
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Source: MSNBC
NewsDateTime: 1 hour ago
House rejects bailout; stock market plunges
... were the dire predictions from Bush, his economic team and their own party leaders of an all-out financial meltdown if they failed ... About the bailout plan The major details of the $700 billion rescue package that congressional negotiators had approved ...
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Source: Detroit News
NewsDateTime: 1 hour ago
n Sunday evening, the House Republican working group, which stringently opposed earlier drafts of the plan and offered a counterproposal, indicated it would support the bill, and its members are encouraging other Republicans in the House to do the same. "Nobody wants to have to support this bill, but it's a bill that we believe will avert the crisis that's out there," House Minority Leader John Boehner, R-Ohio, told reporters. But the bill did draw some opposition during the morning debate. Rep. John Culberson, R-Texas, said the measure would leave a huge burden on taxpayers. "This legislation is giving us a choice between bankrupting our children and bankrupting a few of these big financial institutions on Wall Street that made bad decisions," he said. Other conservative Republicans argued the bill would be a blow against economic freedom. Thaddeus McCotter, R-Mich., said the bill posed a choice between the loss of prosperity in the short term or economic freedom in the long term. He said once the federal government enters the financial market place, it will not leave. "The choice is stark," he said. But there were also Democrats who opposed the bill for not doing enough to help those who taxpayers facing foreclosure or needing unemployment benefits extended, or taxing Wall Street to pay for the rescue package. "Like the Iraq war and patriot act, this bill is fueled by fear and haste," said Lloyd Doggett, D-Texas. The crisis and a proposed fix Banks and Wall Street firms, worried about both their own needs for cash and the condition of other institutions, essentially stopped loaning money to one another in recent weeks. That choked off the money being made available on Main Street in the form of mortgage loans, business loans and other consumer borrowing. The crisis stems from problems in mortgage-backed securities, which saw their value plunge as home prices have gone into their worst slide since the Great Depression and foreclosures have soared to record levels. In turn, the market for trillion of dollars worth of those securities held by major firms evaporated, sending them down to fire sale prices and raising the risk of widespread failures among the nation's major financial firms. Under the plan, Treasury will buy the mortgage backed securities, either directly from the firms or through an auction process. It may also arrange to provide guarantees for the securities up to their original values in return for premiums they would charge current holders of the securities. To make the legislation more politically palatable, the bill calls for the government, as an owner of a large number of mortgage securities, to exert influence on loan servicers to modify more troubled loans to help prevent additional foreclosures. It also provides that the government will take equity in the firms that sell the securities to the government, and limits pay packages for top executives. The legislation comes amid great upheaval in the nation's financial system. On Monday morning, the Federal Deposit Insurance Corp., which insures deposits at failed banks, arranged for the sale of the banking assets of Wachovia (WB, Fortune 500), the nation's No. 4 bank holding company, to Citigroup (C, Fortune 500) for $2.2 billion in stock. That follows three weeks of other shocks: the Treasury Department's seizure of mortgage finance firms Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500); Wall Street firm Lehman Brothers' bankruptcy filing; rival Merrill Lynch (MER, Fortune 500) purchase by Bank of America (BAC, Fortune 500). In addition, the Fed bailed out insurance giant American International Group (AIG, Fortune 500), loaning it $85 billion in return for a nearly 80% stake. while Washington Mutual (WM, Fortune 500), the nation's largest savings and loan, became the largest bank failure in history.
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