Senate approves bailout after revisions, 74-25
WASHINGTON — With both presidential candidates returning to the Capitol to lend support, the Senate voted reluctantly but solidly in favor of a modified $700-billion Wall Street rescue plan tonight. But it remained uncertain whether the legislation, even with a carefully designed package of tax breaks, would be able to withstand the fierce crosswinds of liberal and conservative resistance in the House later this week.
The Senate voted 74-25 to approve the measure, whose centerpiece is giving the government the authority to buy up billions of dollars of the toxic assets that have poisoned financial markets and threaten to contaminate the rest of the economy.
The Senate action came two days after House members, facing reelection within weeks and confronted by angry constituents, rejected an earlier version of the plan and sent the stock market into a tailspin. The House will take up the new bill Friday morning.
House Minority Leader John Boehner (R-Ohio) said the package passed by the Senate had a “much better chance” of passing the House than the measure defeated Monday. But he said he was “not taking anything for granted.”
“I do think that the big [stock market] drop on Monday really had a chilling effect on a lot of our members and a lot of their constituents,” Boehner said on Fox News.
The market reaction, compounded by polls suggesting the public was more divided and confused than opposed to the plan, led the Senate to add a number of other provisions on lawmakers’ wish lists in the hope it would attract enough votes to pass this week.
Some additions were meant to appeal to a broad range of Americans, including a hike in the limit for federally insured bank deposits to $250,000 from the current $100,000. Other additions were intended to appeal to narrower interests and to win the votes of specific lawmakers, such as a tax break designed to encourage Hollywood studios to do more filming in the United States.
The presence of both presidential candidates was seen as additional pressure to go along with the man from their party who might occupy the White House in a matter of months.
“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,” Sen. Barack Obama of Illinois, the Democratic nominee. Sen. John McCain of Arizona, the Republican nominee, was present but did not speak. Both voted for the measure, as did Obama’s running mate, Sen. Joe Biden of Delaware.
Obama and others said they understood the anger of voters who felt they were being asked to bail out unfeeling financiers on Wall Street.
“It would be one thing if we had a choice,” said Sen. Dianne Feinstein (D-Calif.). “But I don’t believe we have a choice.”
With the modifications, the measure includes a tax benefit for bicycle commuting sought by Rep. Earl Blumenauer (D-Ore.), who voted no on Monday. It also includes an extension of the renewable energy tax credit, a priority of Rep. Gabrielle Giffords (D-Ariz.), who has said she wants to make Arizona the “Silicon Valley of solar energy.”
In the 12 days since it was proposed by the Treasury Department, the measure has grown from a three-page proposal to a 451-page piece of legislation titled the Emergency Economic Stabilization Act.
As the day began with word of progress on the bill in the Senate, stocks moved mildly. The Dow Jones industrial index finished the trading session down about 20 points.