Bailout Bill Picks Up Steam

Senate Passage Appears Assured; Opposition From House Republicans Said To Weaken

(CBS/AP)  After one spectacular failure, the $700 billion financial industry bailout found a second life Wednesday, speeding toward passage in the Senate and gaining ground in the House where conservative opposition seemed to soften.

Bipartisan supporters rallied around a unity theme - a stark contrast to the political bickering that marked Monday's shocking House defeat, reports CBS News correspondent Bob Orr.

Senators loaded the economic rescue bill with tax breaks and other sweeteners for the right and left, hoping to secure approval in the House by Friday.

The measure has not caused the same uproar in the Senate, where both parties' presidential candidates, Republican John McCain and Democrat Barack Obama, were making rare appearances to vote their support. That would send the package back to the House, where passage would require a turnaround of 12 votes from Monday's 228-205 defeat.

Leaders in both parties, as well as private economic chiefs everywhere, said Congress must quickly approve some version of the measure to start loans flowing and stave off a potential national economic disaster.

"This is what we need to do right now to prevent the possibility of a crisis turning into a catastrophe," Obama said. "To Democrats and Republicans who've opposed this plan, I say: 'Step up to the plate. Let's do what's right for the country at this time, because the time to act is now."'

At the White House, President Bush said, "It's very important for members to take this bill very seriously."

Even as the Senate neared its vote, congressional leaders targeted the 133 House Republicans who voted against the bill Monday.

House GOP opposition appeared to be easing after the Senate added $100 billion in tax breaks for businesses and the middle class, plus a provision Republicans advocated to raise, from $100,000 to $250,000, the cap on federal deposit insurance. They were also cheering a decision Tuesday by the Securities and Exchange Commission to ease rules that force companies to devalue assets on their balance sheets to reflect the price they can get on the market.

The heart of the bill, and the opposition to it, remained the same. It would enable the government to spend billions of dollars to buy bad mortgage-related securities and other devalued assets held by troubled financial institutions. If successful, advocates say, that would allow frozen credit to begin flowing again and keep the economy from a deep recession.

Proponents say the government eventually could sell the devalued assets at a better price, reducing the program's final cost.

As for House passage, there were worries that the tax breaks would cause some conservative-leaning Democrats who voted for the rescue Monday to abandon it because it would swell the federal deficit.

"I'm concerned about that," said Rep. Steny H. Hoyer, D-Md., the majority leader.

A CBS News poll showed that while the vast majority of Americans feel the financial crisis is a national problem, voters remain split on whether the bailout is the right solution.

As revised by the Senate, the package would extend several tax breaks popular with businesses. It would keep the alternative minimum tax from hitting 20 million middle-income Americans, and provide $8 billion in tax relief for those hit by natural disasters in the Midwest, Texas and Louisiana.

The bill would not point to offsetting spending cuts to pay for the AMT and disaster provisions, but it would have revenue offsets for part of the energy and extension measures. The failure to offset many of the tax cuts angered the House's band of "Blue Dog" Democrats.

The increase in the deposit insurance cap was a bid to reassure individuals and businesses with accounts in banks and similar institutions.

The Senate specializes in high-stakes legislating-by-enticement, and the long list of sweeteners it added was designed to attract votes from various constituencies.

Tax cuts new and old are favorites for most House Republicans, the main target of intense lobbying to gain support for the measure. Help for rural schools was aimed mainly at lawmakers in the West, while disaster aid was a top priority for lawmakers from across the Midwest and South.

Another addition, to extend the deductibility of state and local taxes for people in states without income taxes, helps Florida and Texas, among others.

And there were plenty of obscure tax breaks to go around, like one for certain wooden arrows used by children, and another benefiting litigants in the 1989 Exxon Valdez oil spill.

Senate leaders were expected to try adding another goodie before the final vote: extending a tax break for homeowners who do not itemize their tax returns.

Raising the federal deposit insurance limit - along with the SEC's decision to ease accounting rules on valuing assets - helped House Republicans claim credit for some substantive changes.

And with constituent feedback changing dramatically since Monday's shocking House defeat and the corresponding market plunge, lawmakers' comfort level with the package increased markedly.

Rep. John Shadegg of Arizona, a leading conservative who voted no on Monday, told CNN Wednesday he's "strongly leaning" toward voting for the plan.

Asked if was ready to switch from no to yes, Rep. Steve LaTourette, R-Ohio, said: "Not yet, but it's getting there."

Sen. John Thune, R-S.D., said Republicans "can argue now that there have been some steps taken that they recommended."

The aftermath of Monday's vote, he said, has "changed the complexion, too, of what people's constituents are now saying. ... There's more of a recognition that we have to do something."

Besides Obama and McCain, Democratic vice presidential nominee Joe Biden was voting on the Senate bill.

Other provisions added by the Senate include a measure to require large companies' health plans to give equal treatment to mental health or addiction if they cover such illnesses. The House and Senate have passed similar "mental health parity" measures, but none has gone to Bush for his signature.

[dj282008]

So Americans would rather go through another depression?

I think we need to look past the fat cats and look at the whole picture

[rational_1]

I think we need to look past the fat cats and look at the whole picture
Posted by dj282008 at 08:18 AM : Oct 01, 2008

I''ve been trying to do that and am left with one big question that leaves me wondering why this humongous bailout is really necessary. From what I''ve read about 3-5% of mortgages are in default, which means at least 95% of people are sending in their monthly payments. So, why is there suddenly this complete inability of banks to come up with credit if the vast vast majority of people are still paying their mortgages? Does anyone out there know?

It seems to me that these politicians are running around like chickens with their heads cut off. Paulson suddenly panics after previously telling everyone that the economy is basically sound, and these lawmakers start freaking like little girls who''ve seen a mouse.

I just don''t get it, I really don''t - and I suspect most in the House don''t either.

[liberalme]

NO WAY!!!! Anyone that votes to bail out wall street fat cats should be voted out of office.
Americans don''''t want this passed!!!

Posted by GrabAndGo

I agree 100%!! The taxpayers have enough on their plates and no one to bail us out.

I would love to replace everyone in Washington--after the past 8 years--I''m all for term limits for these representatives.

[liberalme]

I just don''''t get it, I really don''''t - and I suspect most in the House don''''t either.

Posted by rational_

They have been using the same urgency as they did for Bushs manufactured Iraq war, after the market went up yesterday---this is not as urgent as they say.

What they want is a rush job so they can get back to their electorates.

Well, let us not rush to vote these people back in---take your time and get all those up for re-election---out!!

[dj282008]

I agree 100%!! The taxpayers have enough on their plates and no one to bail us out.

I would love to replace everyone in Washington--after the past 8 years--I''''m all for term limits for these representatives.

So you would rather the economy fail? Wall street is the foundation of our economy, if it fails so does everything else? And your ok with this, becuase you don''t like the idea because of the fact that banks need more money. Fine Let it Fail. But NOT one Da-mn person better b*itch because we go into another depression. Because the only one you care about is you

[omega40]

I just don''t get it. They are talking about squandering 700 Billion (at least), adding trillions more to the national debt, and still talking about tax breaks and tax cuts. This is the example they set for the country and then the pundits squeal when people emulate them with their own financial choices. So much for bootstraps and personal responsibility.

[redgwen-2009]

No Bailout

We''ve already seen a considerable market recovery. Will there be fluctuations yet? You bet. Big ones until all this settles of out. But if they go ahead with this bill, we''re going to be sunk for certain because it''s only the beginning of a downward spiral from there, because the next financial entity in crisis will want more money, and then there will be another one, and another one. We''ve seen how many so far? When does it end?

[liberalme]

So you would rather the economy fail? Wall street is the foundation of our economy, if it fails so does everything else? And your ok with this, becuase you don''''t like the idea because of the fact that banks need more money. Fine Let it Fail. But NOT one Da-mn person better b*itch because we go into another depression. Because the only one you care about is you

Posted by dj282008

Ok so why are the everyday working people the ones to constantly bail out the government?
We pay taxes---lots of them.

Currently the taxpayers are funding:

$10 Billion a month for the Iraq debacle.

No one will tell us how much we owe China and Saudi Arabia, but I''ll bet I know hwo will be paying them back.

The Feds gave $630 Billion to the global financial system---who''s fotting that bill?

And now they want to impose up to $700 billion to bail out thieves and irresponsible behavior on Wall St?

Has anyone bothered to add up these figures so we can know exactly what the government is costing us?

Who will bail out the taxpayers---perhaps another $600 stimulus check?

[dj282008]

===But NOT one Da-mn person better b*itch because we go into another depression. Because the only one you care about is you===
Posted by dj282008

Let the (cow) chips fall where they may. We can''''t keep doing this. The cycle of taxpayer-funded corporate welfare has to be broken.

But not at a greater strain. I agree that we really don''t need to do this, but if I had a choice between 700 Billion bail out and what this country went through back in the 30''s? I am sorry bail out wins

[smurfcrusher]

Dressing a pig in new clothes doesn''t mean it''s no longer a pig.

REJECT THE BAILOUT

[omega40]

The other thing I keep hearing is how tighter credit means main street can''t borrow to fund their day to day operations. I don''t know about the rest of you but almost daily I have pre-approved, low interest, credit card offers stuffed into my mailbox. The so called "credit crisis" surly hasn''t stemmed this unsolicited junk mail. This really makes me believe we are all being played by this administration.

[liberalme]

Dressing a pig in new clothes doesn''''t mean it''''s no longer a pig.

REJECT THE BAILOUT

Posted by smurfcrusher

Is that the same concept as a pit bull and lipstick?

[dj282008]

Ok so why are the everyday working people the ones to constantly bail out the government?
We pay taxes---lots of them.

Currently the taxpayers are funding:

$10 Billion a month for the Iraq debacle.

No one will tell us how much we owe China and Saudi Arabia, but I''''ll bet I know hwo will be paying them back.

The Feds gave $630 Billion to the global financial system---who''''s fotting that bill?

And now they want to impose up to $700 billion to bail out thieves and irresponsible behavior on Wall St?

Has anyone bothered to add up these figures so we can know exactly what the government is costing us?

Who will bail out the taxpayers---perhaps another $600 stimulus check?

Who is going to help us when we need stuff? The bail out is wrong. I am not debating this issue. I agree it is a load of ***. But if you think our economy is bad now, what happens when the economy fails. Then what happens. Gas will Sky Rocket. Loans will be almost impossible to acheive, more people will go into foreclosure and a complete collasps of our banking system. Thats what people need to look at. Not the Wall-Street cats. IMHO, if we have to bail them out, send them ALL to prison, and they loose every dime of there pension. If we have to bail them out, they are broke and it will stay that way.

I have class so I will be back in one hour. All comments directed to me can be made via e-mail [e-mail]. Please tell me what topic so I know where to reply.

Thanks

[omega40]

I honestly believe that this crisis is self-generated. Everyone in Wall Street thinks that this is a crisis, so they are going to make d@mn sure it becomes a crisis. Its a self-fullfilling prophecy as panic of the crisis is far greater than the actual threat.


Posted by rafterman1


True. It has often been said that the markets are driven by greed and fear. Those two emotions never lend themselves to careful, analytical thought.

[j62kd4b]

This "new" Senate bailout/rescue is nothing but LIPSTICK on a PIG - this time the pigs are called SENATORS!
Throw these money changers out of the US Temples!

[liberalme]

True. It has often been said that the markets are driven by greed and fear. Those two emotions never lend themselves to careful, analytical thought.

Posted by omega40 at 08:48

The fact that they are making this so "urgent" is suspicious to me.
Here is an interactive map from MSN on the effect of this in other countries.
The fact that the Feds have "donated" $630 billion to the global finance system should help them out enough to allow our representatives to work on this intelligently and not shooting from the hip creating panic where there should be none.

The map: http://www.msnbc.msn.com/id/26957587

[liberalme]

Read this as well:

http://www.msnbc.msn.com/id/26964201

Eight years of Bush/Cheney greed has ruined this country in ways we could never imagine--and before some idiot pipes in----the Democrats have done absolutely nothing the past 2 years either.

[liberalme]

Posted by liberalme at 08:45 AM : Oct 01, 2008

how old are you? you say you have grandkids, but i find it hard to believe with your ignorant juvenile posts that you are that old


Posted by jamesm12341 at

Shut up jwind11 and just resume your job as the ace CBS spellchecker--

That was just light humor--don''t they ever use humor where you live?

[liberalme]

how old are you? you say you have grandkids, but i find it hard to believe with your ignorant juvenile posts that you are that old

Posted by jamesm12341 at 08:56 AM : Oct 01, 2008

I also have great-grand kids jwind11--how about you--any kids?

[brianbwb-2009]

So now they will print 700 billion of play money, give it unconditionally to Paulson, then eliminate the tax revenue streams that will be need to pay for it?

So Bush has run up the deficit to $10 trillion, and the neocons are saying that it is OK, because we are going to make it impossible to pay off.

Oh well, all things end in time, America, some of the times were nice.

[gumpybear]

There is absolutely nothing the Senate can say or do to make me feel all warm a fuzzy about this illconcieved bill...But if their really are going to do it... then for god sake please do not "OUT SOURCE" the management and administration of this farce to the vary same people who cause the problems!... You all did know that was the current plan right...Do you honestly believe these people can be fair and equal when it comes to handing out the handouts?...If the senate is going steal money out of my pockets then at least put someone responsible in charge!!!!! ...If I wanted nepotism I''d hand my money over to my kids. Sure their ungrateful too but at least their not adding it to their squirreled away millions and laughing at how stupid dad was to fall for their little trick!

[liberalme]

again, how old are you? do you still worry about what cindy mccain looks like without makeup on or have you moved on to sarah palin? nobody cares that you remember what i used to post under either, so if you think you are being clever by posting the jwind11, you arent.


Posted by jamesm12341

Why do you have such a fixation on something I posted once months ago in jest?
You have an inability to add anything of interest or educational to these posts---that must make you feel terribly inferior--which causes you to disect what people post.

That jwind11 makes you appear to be pretty inadequate.

Counseling just might help with that.

[hydrodev]

If our tax money is going to bail them out, we should all be treated as investors in their future. We should all see dividends and shares in their stock. At least give us a reason to want to bail them out, rather than just bail them out because their big risks didn''t pay off. Take big risks to make big money... It doesn''t sound that great when the risks don''t pay off, i know, but too bad. Thats the free market, these companies should be allowed to die.

[donbl1]

If we could just put a muzzle on that idiot Pelosi we might have something.

Glad to see Hoyer being the lead here.

[swingset4u]

Then big corporations SHOULD be made to bring jobs back from overseas! NO Outsourcing if you are bailed out of your own mess!

[sleepyric]

I watch a lot of new interviews with congress members,,,cspan, cspan2,,,probably too much. if the members I saw interviewed who voted NO, don''t vote yes, and I don''t think they will, HANG ONTO YOUR STOCK, because the 2nd try isn''t going to be any better than the first! Get ready for another bad day on Wall St.

[jesusface]

Watch out here comes %u201CFlood Economics"

With their bailout plan Congress is introducing a new kind of economics to the Country: "Flood Economics". Never mind the trickling down of money from the rich to the middle class and poor*. Now this plan uses taxpayer%u2019s money to flood the markets with what we call in the industry zombie securities or revived bad dept.
This incredible innovation in economics management will give the middle class and poor the tools that they will need to get through the flood: a shovel, a sand bag and a cross%u2026

* "Trickle-down economics", which is the economic-political argument that the increases in the wealth of the rich are good for the poor because some of such additional wealth will eventually trickle down to the middle class and to the poor.

[mrs_premise]

As a member of the Christian race, I urge everyone to urge passage of this bill that our beloved Presdient Bush has presented to us. If we fail to act, living in cardboard boxes and standing in souplines are surely in our future and we would have only ourselves to blame. I urge all to reject the cries of liberal extremists Rush Limbaugh and Sean Hannity for like all liberals would only be happy with a destroyed America.

[chlee222]

I feel that the government should give every U.S. BORN CITIZEN that is working at least $75,000.00 a piece to spend. This would boost the economy. Because they would pay off their own bills and buy things that need to survive on their own.If you are any public assistance you don''t need to give them more free money that us working people have to pay for. Quit bailing out the big CEO''S MAKE THEM ACCOUNTABLE for their errors. And stop paying them big bucks for sitting on their duffs doing nothing!

[observantx]

The lobbyists are descending on Washigton like a plaque of locusts to pressure the Senate and House to pass the bill. We need someone like Jesus who drove the moneychangers out of the temple to kick these K street hucksters out of the Capital building.

Wall Street and these palm greasers have a great wonderful extravagent eight year long party. Lots of wine n dine & arm candy and now they oh so graciously present us with "the bill".

Sorry guys.

Off to the kitchen to work off YOUR bill at the kitchen sink. Oh, and by the way, the floor needs a good mopping and I think the toilet''s clogged again.

Hop to it.

[brianbwb-2009]

So the public was against the bill by a 9 to 1 margin, now that the neocons have added tax breaks for the rich, the ratio is now 50/50?

No way the press is again being lied to, and helping spread these lies so that the lipstick looks better on the pig.

Come on CBS, did you not learn from Iraq, you would continue to trumpet even economic treason?

[mrs_premise]

If we could just put a muzzle on that idiot Pelosi we might have something.

Glad to see Hoyer being the lead here.


--------------------------------------------------------------------------------

Posted by donbl1
----------------
Yes how dare she point the finger of blame at republicans for things republicans have done but obviously arent supposed to be held accountable for.

[liberalme]

liberalme never mind James hes as big a govt. t!t sucker as anyone. He is just really hypocritical about it.



Posted by fedupwithit1 at 09:16 AM : Oct 01, 2008

I know he''s just like a little gnat---want to give him a swat.

[classicdoc]

The bailout made no sense the first time, and it makes no sense now. Why would anybody listen to Bernanke and Paulson--they and their predecessors presided over the development of the problems. They didn''t warn us. They didn''t stop or fix what was going on. Now suddenly they want $700 bil. The Federal Reserve caused a huge credit bubble with its easy-money tinkering in the economy several years ago. Fannie and Freddy are governmenent creations that behaved irresponsibility for years. Whatever restructuring is now needed, the market can do it better than the Keystone Cops in the government. Step aside and let it work. Or descend into fascism.

[liberalme]

I urge all to reject the cries of liberal extremists Rush Limbaugh and Sean Hannity for like all liberals would only be happy with a destroyed America.



Posted by Mrs_Premise at 09:19 AM : Oct 01, 2008

HAHAHAHAHA
Since when did Hannity and Lintball become LIBERALS???

[redbds]

If our tax money is going to bail them out, we should all be treated as investors in their future. We should all see dividends and shares in their stock. At least give us a reason to want to bail them out, rather than just bail them out because their big risks didn''''t pay off. Take big risks to make big money... It doesn''''t sound that great when the risks don''''t pay off, i know, but too bad. Thats the free market, these companies should be allowed to die.

Posted by hydrodev at 09:15 AM : Oct 01, 2008

It does not work that way. The government is going to buy bad debt from the banks/mortgage companies in the form of securities. The government won''t own stock in the companies or even own the actual mortgages. This will do nothing to address the issue of bad mortgages. It is just an infusion of more credit to free up credit and remove some of the risk that the companies took in the form of bad loans. I am not an economist but it makes absolutely no sense to me and I don''t see how it can possibly work.

[jsl45]

George W. Bush, the Herbert Hoover of the 21st Century.

[donbl1]

Mrs_Premise, leadership is not about pointing fingers.

Leadership is doing the right thing for America.

BTW, the calls are now 50/50 and the bill will pass.

The majority of Americans are invested through pension funds, 401K/IRA or their own savings. The reality now facing them and especially Boomers dictates "some" sort of Government action.

[donbl1]

Saw an article today from the NYT from 1999 stating that there seemed to be poor loans being made to Blacks and Hispanics who could not really afford the loan.

This is one quote from the article:

"Demographic information on these borrowers is sketchy. But at least one study indicates that 18 percent of the loans in the subprime market went to
black borrowers, compared to 5 per cent of loans in the conventional loan market"

This was strongly supported by Bubba and both political parties in the search to give EVERY American a home.

[redbds]

The majority of Americans are invested through pension funds, 401K/IRA or their own savings. The reality now facing them and especially Boomers dictates "some" sort of Government action.

Posted by donbl1 at 09:27 AM : Oct 01, 2008

I am not opposed to government action. I just don''t see how the government borrowing $700 billion in credit to throw at this problem will help. The problem needs to be addressed from the bottom up. Turn those bad mortgages into good mortgages by restructuring the mortgages to a reasonable fixed rate that the lenders can afford.

[classicdoc]

"George W. Bush, the Herbert Hoover of the 21st Century."

Well, Hoover didn''t get us into war. But yes, when the market crashed, he began his destructive meddling in the economy which made things worse. Then he handed the ball off to FDR, who REALLY made things worse. Perhaps we''ll have a repeat of that when Bush hands off to Obama.

[whitemale08]

It''s not a "RESCUE PLAN" it''s f***** BAILOUT!!!!!

STOP THE BAILOUTS!!!!!

WE DON''T NEED WALL STREET!!!!!!

WE CAN REBUILD AMERICA WITHOUT YOU!!!!!

[dj282008]

It''''s not a "RESCUE PLAN" it''''s f***** BAILOUT!!!!!

STOP THE BAILOUTS!!!!!

WE DON''''T NEED WALL STREET!!!!!!

WE CAN REBUILD AMERICA WITHOUT YOU!!!!!

And exactly how do you think this is possible

[sickofit54]

According to some sources, the average tax incentive given this year was $1,000, this amounts to an approximate taxpayer bailout of $200,000,000,000. Considering that this is not %u201Cfree%u201D money (i.e. it came from us to begin with) the most logical thing to do as taxpayers would be to tell our elected officials Hell No, no fat cat bailout it is time to stop the madness, now. We vote them in if they do a bad job we need to vote them out. We the people need to become ACTIVE in our government and quit following them like lemmings to our destruction.

[whitemale08]

QUIT TRYING TO PROTECT WORTHLESS DERIVATIVES!!!!

DERIVATIVES WILL BANKRUPT THE TAX PAYER!!!!!!

SAY NO TO BAILOUTS AND NO TO WALL STREET

THERE IS A PLAN B!!!!!

larouchepac.com

[donbl1]

redbds, I hate the idea of adding that much to deficit spending.

However, I do not see a good example.

Several articles today on Bloomberg and CNBC about companies not being able to borrow money as the banks will not lend.

The result of that will be companies closing down or laying off.

In just one example, Ford may go into default today if they do not come up with $1.5B in payments that was supposed to come from the banks through credit arrangement.

Ford still employs over 100K people plus thousands more at suppliers.

Got to get the Banks to start lending at reasonable rates or we will have a dramatic slowdown.

[republic1776]

NO Bail Out!
They fail to hear the people''s voice and cater to the special interest''s!
Senator Fattah, of PA. Kiss my vote goodbye!

[whitemale08]

And exactly how do you think this is possible


--------------------------------------------------------------------------------

Posted by dj282008 at 09:33 AM : Oct 01, 2008--

Please be brave, and go to larouchepac.com for a 1:00pm webcast where he explains PLAN B for Congress.

[wevehadenuf]

NO BAILOUT! THEY HAVE MADE THE BILL EVEN WORSE! HOW OBSCENE! NOTHING IN THIS BILL PROTECTS THE PEOPLE WE WOULD JUST BE THROWING THE MONEY TO THEM. THIS IS THE BIGGEST SCAM SINCE THE IRAQ WAR! NOW TAX CUTS?!?! IF THE REPUBLICAN NOW PASS THIS EVERYTHING PELOSI SAID WAS TRUE, ADDING TAX CUTS FOR THE GREEDY TO GET IT PASSED WHAT A SHAME OUR COUNTRY HAS COME TO THIS

[txgrouch2006]

NO BAILOUT!

The first vote revealed WHO are the conflicted members of Congress - the ones who are PERSONALLY invested in subprime loand. The ones who are trying to BAIL THEMSELVES OUT from the "affordable housing" meltdown.

The rest of Congress can see what an AWFUL idea this is. We are REWARDING the fat cats like Barney Frank for pandering to their poor constituents by putting them in houses they never could have afforded.

NO BAILOUT! LET THEM TRY UNTIL H3@L FREEZES OVER, it must not pass.