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Democrats: Bailout support is costly
Lawmakers are engaged in a $700 billion game of chicken this week over the Bush administration’s push to pass an economic bailout proposal for Wall Street.
Key Democrats in Congress, backed by party presidential nominee Sen. Barack Obama on the campaign trail, made it clear Sunday that their support for the rescue blueprint offered by Treasury Secretary Henry M. Paulson Jr. comes with a price.
House Speaker Nancy Pelosi, California Democrat, vowed late Sunday to push for an independent oversight board for the Treasury bailout effort, as well as protections for homeowners facing foreclosure and new restrictions on lucrative Wall Street executive salaries, both of which Mr. Paulson has opposed.
“We will not simply hand over a $700 billion blank check to Wall Street and hope for a better outcome,” Mrs. Pelosi said.
Other Democrats were concerned that loading up the rescue package with too many add-ons could torpedo the bill and leave them responsible for its failure.
Democrats “will not ‘Christmas-tree’ this bill,” Sen. Charles E. Schumer, New York Democrat and a key player in the backroom negotiations, said on “Fox News Sunday.”
Republican congressional leaders largely have lined up behind Mr. Paulson’s request that Congress pass a “clean bill” with few amendments, but they face a rebellion in their own ranks from conservatives unhappy with the idea of a massive federal intervention in the markets.
Mr. Obama of Illinois and top congressional Democrats say they support the bailout plan, given the fallout to the national and global economy from the current credit and asset crisis.
But Senate banking committee Chairman Christopher J. Dodd of Connecticut and House Financial Services Committee Chairman Barney Frank of Massachusetts both predicted that the three-page administration bill would be changed before final passage.
“Secretary Paulson and I have a lot of agreement, but we have a difference of opinion on what’s clean,” Mr. Frank said on CBS’ “Face the Nation.”
Mr. Frank echoed Mrs. Pelosi, saying he would be looking to add provisions limiting compensation for executives in failed banks and other financial firms that receive taxpayer aid. Democrats say they will redouble efforts to pass a $100 billion economic stimulus bill targeting Main Street.
“I don’t think that dirties up the bill,” Mr. Frank said.
Republicans face divisions of their own, with some Republican conservatives vowing to vote against the measure on principle.
House Minority Leader John A. Boehner, Ohio Republican, said a sobering closed-door briefing by Mr. Paulson and Federal Reserve Chairman Ben S. Bernanke on Thursday evening persuaded him to support the administration plan without amendments, despite his reservations.
“This is not a time for ideological purity,” Mr. Boehner said on “Fox News Sunday.” “This is not a time to be playing games.
About the Author
Raised in Northern Virginia, David R. Sands received an undergraduate degree from the University of Virginia and a master’s degree from the Fletcher School of Law and Diplomacy at Tufts University. He worked as a reporter for several Washington-area business publications before joining The Washington Times.
At The Times, Mr. Sands has covered numerous beats, including international trade, banking, politics ...
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