HOUSE BALKS AT BAILING OUT S&L BAILOUT AGENCY
WASHINGTON — The US House of Representatives refused Tuesday to provide another $30 billion to pay depositors who had money in failed thrifts. The Senate approved the $30 billion last week.
Unless it gets more cash, the Resolution Trust Corporation (RTC) - set up to take over failed thrifts, sell their assets, and pay off depositors - will soon run out of operating funds.
The final House vote came amid widespread complaints about the way the government is dealing with the defunct thrifts. Lawmakers also are concerned about a voter backlash over the amount of money being spent on the thrift salvage operation.
White House spokesman Marlin Fitzwater said President Bush was disappointed the legislation did not pass.
The administration requested the $30 billion for the RTC. Even if it gets that money, the administration is expected to come back in the fall with a request for $50 billion more. Congress authorized $50 billion for the operation in 1989.
The House, in a series of votes, rejected several alternative plans for continuing funding the agency.
A so-called ``pay-as-you-go'' plan that would have drawn the $30 billion from current funds rather than adding it to the government's long-term debt was rejected on a 237-to-186 vote.
The House then defeated, 235 to 190, an administration-backed proposal that included a few RTC management reforms and also rejected, 303 to 121, a plan offered by Rep. Henry Gonzalez (D) of Texas, chairman of the House Banking, Finance, and Urban Affairs Committee, that proposed major changes in the way the RTC operates.
The basic bill, just providing the requested $30 billion, was defeated 220 to 201.