White House spokesman Tony Fratto briefed reporters Tuesday morning on the negotiations with Congress over a $700,000,000,000 bailout proposal. Congress showed some reluctance Monday to rubber stamp the plan as written by Treasury Secretary Henry Paulson. Congressional leaders have said, however, that agreement has been reached on large portions of the proposal and that they expect a deal within the week or early next week at the latest.
"Sec. Paulson and his team are still negotiating with members of Congress," said Fratto. "I'm going to tray to avoid getting in the way of those negotiations."
The president, he said, is in New York for the U.N. General Assembly meetings and will have a passage in his speech about the "challenges we're facing in our financial markets."
Fratto pressed the case that Democrats must move quickly to pass the bailout package this week. "Our markets are dealing with some very serious challenges. One of those challenges [is] a little bit of uncertainty how the policy response from Washington will take place, whether it will take place as quickly as needed," he said. "People want to be confident that it will get done this week, that we will come together in a bipartisan way, that there is sufficient leadership in the House and Senate and from the committee chairman and from the leaders in the Republcan Party to get this done."
He conceded that "the legislative process can be bumpy sometimes" and that members "rightly have questions how a program like this will be implemented and whether it's the best way." He said, though that the administration is confident it deals with the "real root cause of what's been effecting our markets."
It's important, Fratto reiterated, that we "move qauickly, get a clean bill out of the Congress [so that] market participants and the American people can see that Washington is acting on this in a forthright way."
As for differences with with Democrats on foreclosure relief, Fratto said he wante to "remind everyone just recently we passed a very large housing bill to help homeowners." With regard to oversight and transparency, he said, the administration agrees with Democrats that it was necessary.
Fratto said that there would be "dire" consequences if the package didn't pass. "You should think of that as unthinkable. Every business, every employer and so every employee depends on" the credit markets to continue to flow "to maintain normal business operations," he said. "It would be a very very serious situation for our economy were we not to get this legislation passed."
Asked why there was so much urgency to get the package done this week, he stressed the consequences of the freezing of the credit market. "In terms of this week, it shouldn't take much analysis to remember what happened last week, which was a very serious freeze up in our credit markets," said Fratto. "I said earlier, our financial markets do not need uncertainty."