Lorain/Elyria, OH
U.S. House rejects bailout of financial system
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By JULIE HIRSCHFELD
Associated Press Writer
WASHINGTON (AP) — The House on Monday defeated a $700 billion emergency rescue for the nation’s financial system, ignoring urgent warnings from President Bush and congressional leaders of both parties that the economy could nosedive into recession without it.
Stocks plummeted on Wall Street even before the 228-205 vote to reject the bill was announced on the House floor.
Bush and a host of leading congressional figures had implored the lawmakers to pass the legislation despite howls of protest from their constituents back home. Despite pressure from supporters, not enough members were willing to take the political risk just five weeks before an election.
Ample no votes came from both the Democratic and Republican sides of the aisle. More than two-thirds of Republicans and 40 percent of Democrats opposed the bill.
The overriding question for congressional leaders was what to do next. Congress has been trying to adjourn so that its members can go out and campaign. And with only five weeks left until Election Day, there was no clear indication of whether the leadership would keep them in
A White House spokesman said that President Bush was “very disappointed.”
“There’s no question that the country is facing a difficult crisis that needs to be addressed,” Tony Fratto told reporters. He said the president will be meeting with members of his team later in the day “to determine next steps.”
“Obviously we are very disappointed in this outcome,” Fratto said. “. There’s no question that the country is facing a difficult crisis that needs to be addressed. The president will be meeting with his team this afternoon to determine the next steps and will also be in touch with congressional leaders.”
Monday’s mind-numbing vote had been preceded by unusually aggressive White House lobbying, and spokesman Tony Fratto said that Bush had used a “call list” of people he wanted to persuade to vote yes as late as just a short time before the vote.
Lawmakers shouted news of the plummeting Dow Jones average as lawmakers crowded on the House floor during the drawn-out and tense call of the roll, which dragged on for roughly 40 minutes as leaders on both sides scrambled to corral enough of their rank-and-file members to support the deeply unpopular measure.
They found only two.
Bush and his economic advisers, as well as congressional leaders in both parties had argued the plan was vital to insulating ordinary Americans from the effects of Wall Street’s bad bets. The version that was up for vote Monday was the product of marathon closed-door negotiations on Capitol Hill over the weekend.
“We’re all worried about losing our jobs,” Rep. Paul Ryan, R-Wis., declared in an impassioned speech in support of the bill before the vote. “Most of us say, ‘I want this thing to pass, but I want you to vote for it — not me.’ “
With their dire warnings of impending economic doom and their sweeping request for unprecedented sums of money and authority to bail out cash-starved financial firms, Bush and his economic chiefs have focused the attention of world markets on Congress, Ryan added.
“We’re in this moment, and if we fail to do the right thing, Heaven help us,” he said.
The legislation the administration promoted would have allowed the government to buy bad mortgages and other rotten assets held by troubled banks and financial institutions. Getting those debts off their books should bolster those companies’ balance sheets, making them more inclined to lend and easing one of the biggest choke points in the credit crisis. If the plan worked, the thinking went, it would help lift a major weight off the national economy that is already sputtering.
The fear in the financial markets send the Dow Jones industrials cascading down by as over 700 points at one juncture. As the vote was shown on TV, stocks plunged and investors fled to the safety of the credit markets, worrying that the financial system would keep sinking under the weight of failed mortgage debt.
“As I said on the floor, this is a bipartisan responsibility and we think (Democrats) met our responsibility,” said House Majority Leader Steny Hoyer, D-Md.
Asked whether majority Democrats would try to reverse the stunning defeat, Hoyer said, “We’re certainly not going to abandon our responsibility. We’ll continue to focus on this and see what actions we can take.”
Several Republican aides said House Speaker Nancy Pelosi, D-Calif., had torpedoed any spirit of bipartisanship that surrounded the bill with her scathing speech near the close of the debate that blamed Bush’s policies for the economic turmoil.
Without mentioning her by name, Rep. Adam Putnam, R-Fla., No. 3 Republican, said: “The partisan tone at the end of the debate today I think did impact the votes on our side.”
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” Great news the bill did not pass in the House. 227 - 206
Republicans coming in 134-64 against, while Democrats voted 141-94 in favor.
Dems are really looking bad on this one. I’m shocked they want to bail out the banks and not side with the American people… “
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“Dems are really looking bad on this one. I’m shocked they want to bail out the banks and not side with the American people…”
A small loss is the same as a huge loss, except for when/if the poop hits the fan…
Then the Democrats can claim that at least they *tried* to clean up the Republican’s mess, and would have if the Republicans weren’t so against the fix.
Good political move by the Democrats FOR A CHANGE!!!
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Politics, politics, politics - and a whole lot of finger pointing. I hope that people who were clamoring against passage of this bill have no money in a 401K, or IRA, or the stock market in general. Be careful what you ask for.
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How is this problem the rebulicans fault?
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I hear a lot of doom and gloom is headed our way because this bill didn’t pass.
But I don’t see it that way.
Stock prices are artificially high thanks to speculators and others who purchase and sell the same stocks several times a week.
The stocks are priced higher than their value, due only to supply and demand, not based on how the company the stocks support preform.
So, we can throw our tax dollars at the problem keeping real estate and stock prices artificially high for the benefit of the speculator, or let things settle down to where they should be, for the benefit of Joe Blow who just wants to buy a house in a good neighborhood and not spend half a million smackers.
Let’s let companies worry about production, rather than the shareholders, and whether or not someone is going to rape their pension fund!
If we had some kind of responsible oversight, rather than the Republican plan to deregulate every corporation at a high cost to our citizens, stocks and other commodities wouldn’t be priced at such impractically high rates.
If you have a 401K, the stocks are still there to back it up, they just won’t be worth as much. But what the hey, YOU gambled on the stock market rather than safer investments.
It’s not the job of ALL tax payers to bail you out.
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“How is this problem the rebulicans fault?”
The Republicans embraced the god of senility, Ronnie ‘Pull my Finger’ Reagan’s policy of screwing the people, while helping the corporations, through golden oldies like “Deregulation” and “The Trickle Down Theory” which turned out to be the ‘*blank* on ‘em’ practice.
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Dan S the fix is not a fix at all its a 700,000,000,000,000 dollar money grab. Never should taxpayer money go to bail out a private company especially one who prayed on the poorest of our citizens and caused the bubble they are in.
You have to think for yourself on this one, this is such a simple scenario, good God can people be so stupid…
The market will right itself, let them figure it out by buying and merging like any other industry does. No American got bailed out when they lost their home. This shows you just who’s side these people are on, not the American people.
Don’t just agree because you can’t think for yourself.
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So should you invest in the market today since it went down 600 points?
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Its a shame the IGNORANCE of people. We are headed for a huge financial downfall. And the IGNORANT people will blame BG.
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“Dan S the fix is not a fix at all its a 700,000,000,000,000 dollar money grab.”
Right, I should have put the word “fix” in quotation marks, or said “proposed fix.”
Now, if you would have bothered to read the rest of my post(s) you might have noticed that I NEVER said or even suggested that the “FIX” was a good thing nor did I indicate that I was for the “bailout.”
OK, that said, time will tell, well maybe, if the “fix” was a good idea or not.
I was just saying that if it turns out that going against the “proposed fix” is later determined to be a “bad” thing, than the Democrats could come back and say that they tried to pass it with a majority of their votes, while the Republicans voted against it with a majority of *their* votes.
That’s a better way to place blame than the temper tantrum McCain is now throwing, blaming the Democrats for the “fix” not passing.
The dried up little turd has nothing to back that one up.
I mean, other than the normal Republican LIES!!!
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“Its a shame the IGNORANCE of people. We are headed for a huge financial downfall.”
Right George “Chicken Little” Bush tells us the sky is falling, and you accept that as fact…
…then call *others* ignorant for not believing him when he claims that we need to throw several thousand tons of money at it *RIGHT NOW!*?
If Bush and Paulson are such “experts” on the subject, why did they give the economy a clean bill of health just weeks ago?
If they didn’t see something as catastrophic as what they are NOW claiming is in our future, where was their crystal ball two weeks ago?
And why should we believe that lying sack of *blank* now?
Republicans thrive on fear…
If you haven’t figured that one out by now *you* might be the ignorant one.
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Dan S. I’m gaining a new respect for you. In response to your trickle down economics reference I thought you’d appreciate a recent comic I found:
http://www.sinfest.net/archive_page.php?comicID=2940
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Here’s a link to a conversation with a libertarian economist which I, being not very knowledgeable about things economic, found very enlightening.
http://bloggingheads.tv/diavlogs/14744
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CNN had some great videos of the Republican’ts making up excuses for voting against the “bailout”!
First they were complaining about not having enough time to do a good bill, because of the Jewish holidays coming up!
THEN they said many decided to change their vote against the bill, because they didn’t like Nancy Pelosi’s tone!
They claimed that the country needed this bill, but because lil’ Nancy hurt some feelings they’re going to punish the country and not vote in something they had previously agreed to!
What a bunch of little *blanks* (hint: rhymes with “itches”)
Instead of being men, and saying that they changed their minds because their constituents weren’t for it and they wanted to represent the people…
…but no, they cry like little girls, that the mean girl Nancy, hurt their feelings, and has a bad attitude, THAT HAS NOTHING TO DO WITH THE BILL!!!
So funny and sad at the same time.
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IN 2004 THE DEMOCRATS said This was all OK! It was REPULICANS that tried to warn you. Maybe you should give talk radio a chance in hear what is said by whom. The is blame on both sides. But from what I have heard even Bill Clinton himself said that the would be problems! I challenge all listening only to the drive by liberal media to give FOX news and talk radio a chance!
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I enjoy all the thoughtful and insightful comments on this site. They help clarify my decision regarding voting. Comments like these are probably the major reason why the founding fathers decided on the electoral college rather than direct popular vote.
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Dan S. quit being a hack. 90+ dems voted against the bill as well. The dems had more than enough without rep help to get this passed. What happened?
Kucinich, Kaptur, and Sutton all voted against it.
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“90+ dems voted against the bill as well.”
Yeah, but the MAJORITY of Democrats voted for it, while the MAJORITY of Republican’ts voted *AGAINST* it.
Personally, I’m glad the bill didn’t pass.
On the other hand, I think it’s funny to watch the Republicans trying to have it both ways, while lying all along about their motives for watching the bill go down in flames.
Sniveling about Nancy hurting their feelings makes ‘em all look like punks.
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**bottomline** the average american citizen will pay.. The rich get richer and the poor get poorer.
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Dan S: You are talking about people looking like punks? Have you ever heard about the pot and the kettle? No one looks very good right now, whether you supported the legislation or not. Of course, you could follow old ladalang to an ultra-liberal web site for “accurate” information and objective analysis. I really don’t care because I took most of my money out of the stock market.
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The Republicans alone are responsible for the problems we now face.
Ever notice that it’s usually the one responsible for a major *blank* up, that’s all, “Now is not the time to point fingers?”
Yeah, that’s the punk McCain, just after he blames the Democrats for the bill not passing.
With each passing day, McCain looks less presidential.
As far as your assertion that no one looks good now…
That’s a load of *blank* since the Democrats are looking GOLDEN, for trying to fix a problem the Republicans are responsible for, and having the Republicans back out, because their little *blank* *blank* feelings were hurt by a girl.
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When President Bill Clinton left office there was a surplus of money. He fixed what Regan and Daddy Bush screwed up. Now eight years later sonny boy Bush has turned a surplus of money into one of the worst crisis that the United States has seen financially in history. But still there are people out there that want another Republican as our President. People we are in for a financial meltdown, a crisis if you will. If you are not worried well than you had better get worried. Read online about Black Tuesday and The Great Depression and you will see what we are in for. We needed that bailout but I think it was alittle to late even for that. We all need to to God to help us in this financial crisis. VOTE OBAMA
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IN 2004 THE DEMOCRATS said This was all OK! It was REPULICANS that tried to warn you. Maybe you should give talk radio a chance in hear what is said by whom. The is blame on both sides. But from what I have heard even Bill Clinton himself said that the would be problems! I challenge all listening only to the drive by liberal media to give FOX news and talk radio a chance!
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This all started with Carter in ‘77 to give everyone a piece of the American dream. The Community Reinvestment Act, and it’s been re-defined since then. A string of DemoRATS have been getting their palms greased and it finally came to a crash.
McCain tried to warn us back in 2005 but everybody thought it was just political posturing. Wake up!
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Former Clinton administration budget adviser and current Obama housing adviser Franklin Raines perpetrated an Enron-like accounting scandal as chief executive officer of Fannie Mae, resulting in his receiving millions in compensation over a six-year period.
Raines and two other top Fannie Mae executives agreed to pay $24.7 million, including a $2 million fine, to settle a civil lawsuit filed in December 2006. It accused Raines and the two other executives of manipulating Fannie Mae earnings, allowing executives to pocket hundreds of millions in bonuses from 1998 to 2004, according to the Associated Press.
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Gee Carter got rid of red lining and that crashed the economy?
If so why is Bank of America doing well? Bank of America is know for it’s work with low income borrowers. It’s probably the biggest lender to formerly red lined people in the country. It’s doing fine because it didn’t knowingly write bad loans.
I know that the Republicans are desperately trying to figure out how to blame this on the minorities. Think a minute, people with very little money or access to credit crashed the economy? Geesh that’s right up there with welfare mothers driving Caddilacs.
Instead of listening to the brain dead drivel on AM radio try this instead
http://bloggingheads.tv/diavlogs/14744
and no it’s not two liberals but two libertarians. If you know the difference. Libertarians are what Republicans claim to be.
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Actual Brownstone the surplus you reference from Clinton was just less of a deficit. This lowered deficit was from the Bush Sr. Administration started but dems try to take credit for. It would have been more had clinton not change things….
Smira I am with you on given other talk radios a change I do it all the time between Rush and NPR. I was listening to NPR today and when one of the speakers was ready to say what created this mess the host cut them off and said we only have a couple more seconds what are you thoughts on Nancy speech…..
My big concern is shouldnt this be left up to the Economist? Who has the resume in congress to make such an important decision?
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