WORLD> America
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WORLD> America
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White House, Congress push for bailout deal
(Agencies)
Updated: 2008-09-28 09:07 The bailout is intended to rescue bankers from bad loans that threaten to derail the US economy and plunge the country into a long depression. Some lawmakers likened the situation to a major car wreck that has backed up traffic -- credit, in this case -- for miles. The rescue is meant to remove the wreckage so credit can start moving to borrowers again, they said. Many House Republicans object to several parts of the administration's approach. Negotiators sought to accommodate enough of their demands to entice a reasonable number them to back the eventual plan, which is nearly certain to be unpopular with many voters. Democrats and administration officials said they were willing to include House Republicans' idea of having the government insure distressed mortgage-backed securities -- but only as an option, not a replacement for the broader idea of buying those toxic securities. "There may be a way in which that could be accommodated as part of the toolbox" available to the Treasury Department, said Sen. John Thune, R-S.D. "As a practical matter, that can't be the engine that drives this bill," he said. It was unclear whether House Republicans would accept those terms. Negotiators also discussed phasing in the program's costs. For example, after the first $350 billion is made available, Congress could try to block later amounts, which could total an additional $350 billion, if it believed the program was not working. The president presumably could veto such a move, however, requiring extra large margins in the House and Senate to override. Differences remained on how to limit compensation to executives of corporations that would be covered by the rescue plan. Whatever emerges "is not the proposal that we got from Secretary Paulson," Reid said. But lawmakers said it would be much closer to Paulson's original plan than to the alternative offered by House Republicans several days ago. McCain, who flew to Washington after Friday night's presidential debate in Mississippi, spent part of Saturday working the phones and "helping out as he can," aide Mark Salter said. But McCain did not enter the Capitol, where his colleagues were voting on a $634 billion spending bill that ended a ban on drilling off the Atlantic and Pacific coasts, and sent billions of dollars to the military. McCain supports such measures. But the vote would have been difficult for him because the bill also included more than 2,000 pet spending projects worth more than $6 billion. That is the kind of pork barrel spending that McCain has pledged to end. Obama campaigned in North Carolina and Virginia. Aides said he placed calls to Paulson, Reid and a key House member to keep tabs on the finance negotiations. Both presidential candidates are trying to position themselves to take at least partial credit if an accord is reached. Obama spokesman Tommy Vietor offered new details from Thursday's contentious White House meeting that underscored the divisions among lawmakers trying to reach an agreement. He said Obama encouraged Paulson to work with the House Republicans. Since then, Vietor said, Obama has urged negotiators to find a compromise with enough options so the treasury secretary has the flexibility "to act in an effective manner to stem this crisis." |
