Why the bailout bill went down

“I’m resolute in my opposition,” said Rep. Darrell Issa (R) of California. “Today we are ending the Reagan era if we vote for this, and we can't come back and fix it next year.” The bill was also a tough call for Democrats, who resented being seen as lining up to bail out Wall Street just before an election, as their GOP challengers claimed to side with Main Street.

“We could lose seats over this,” said Rep. Carolyn Maloney (D) of New York, who nonetheless voted for the plan.

Some Democrats on the left wing of the party repudiated the plan. “What we are considering today is still built on the Paulson-Bush premise that buying up Wall Street’s bad bets will solve the liquidity problem. I don’t buy it,” said Rep. Peter DeFazio (D) of Oregon.

There are less expensive, less risky ways to solve the problem, he said. “We can do better. We should start again on a new package.”

Rep. Emanuel Cleaver (D) of Missouri, a member of the House Finance Committee, delayed his vote until the last minute to see if GOP leaders could deliver a majority of their own caucus. They did not, and he voted against the bill. “There’s no reason for us to go in and bail Bush out if his own party rejects him,” he said.

Monday’s vote marked the sharpest repudiation ever of the Bush White House by House Republicans, who voted against the plan by a margin of 2 to 1.

In a press briefing after the bill failed, House GOP leader John Boehner said Speaker Pelosi’s floor speech before the vote “poisoned” the GOP caucus and cost as many as a dozen Republican votes that had previously been committed to the rescue plan. In her speech, Pelosi blamed America’s financial woes on eight years of the Bush administration’s “reckless economic policies.”

Responding to the bill’s failure, Mr. Bush said: “Our strategy is to continue to address this economic situation head on, and we will be working to develop a strategy that will enable us to continue to move forward.”

Meanwhile, Monday’s vote sent the US Senate back to intraparty and interparty discussions on how to proceed.

“We need to have conversations. We don’t know what the next steps are,” says Jim Manley, a spokesman for Senate majority leader Harry Reid. The Senate had planned to vote on the bill on Thursday.

“The problem is not going away. We’re going to stay here until we find a solution,” said Senate Republican leader Mitch McConnell. “It’s time to fix the problem, not the fix the blame.”

Associated Press material was used in this report.

Previous

1 | 2