House bailout doesn't pass; Shit to hit fan -- News at 11

[The Ozzman]

http://www.msnbc.msn.com/id/26884523?GT1=43001

House votes down massive bailout measure
Debate prior to balloting showed deep reservations about $700 billion plan
BREAKING NEWS
The Associated Press
updated 2:59 p.m. ET, Mon., Sept. 29, 2008

WASHINGTON - 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 Washington. Leaders were huddling after the vote to figure out their next steps.

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 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."

Putnam said lawmakers were working "to garner the necessary votes to avoid a financial collapse."

But the defeat was already causing a brutal round of finger-pointing.

"We could have gotten there today had it not been for the partisan speech that the speaker gave on the floor of the House," House Minority Leader John Boehner said. Pelosi's words, the Ohio Republican said, "poisoned our conference, caused a number of members that we thought we could get, to go south."

Rep. Roy Blunt, R-Mo., the whip, estimated that Pelosi's speech changed the minds of a dozen Republicans who might otherwise have supported the plan.

Rep. Barney Frank, D-Mass., scoffed at the explanation.

"Well if that stopped people from voting, then shame on them," he said. "If people's feelings were hurt because of a speech and that led them to vote differently than what they thought the national interest (requires), then they really don't belong here. They're not tough enough."

More than a repudiation of Democrats, Frank said, Republicans' refusal to vote for the bailout was a rejection of their own president.

"The Republicans don't trust the administration," he said. "It's a Republican revolt against George Bush and John McCain."

In her speech, Pelosi had assailed Bush and his administration for reckless economic policies.

"They claim to be free market advocates when it's really an anything-goes mentality: No regulation, no supervision, no discipline. And if you fail, you will have a golden parachute and the taxpayer will bail you out. Those days are over. The party is over," Pelosi said.

"Democrats believe in a free market," she said. "But in this case, in its unbridled form, as encouraged, supported, by the Republicans — some in the Republican Party, not all — it has created not jobs, not capital. It has created chaos."

Time to get some more cash out of my bank account.

 

[zabu of nΩd]

I heard a lot of that money they were planning to allocate was essentially just blank checks to the CEOs of the target companies. Anyone know if that's true? It wouldn't surprise me if the bailout proposal were complete shit.

 

[chuj666]

Wachovia is going bankrupt

 

[The Ozzman]

Wachovia is going bankrupt

Wrong. Wachovia was sold to CitiGroup.

EDIT: and before you tell me otherwise, my asset manager works for Wachovia Securities (which will change their name probably since they are a stand alone company now) and he told me that's what's happening, even though it's all over the news anyway.

 

[Matt]

Did you hear what Paulson was saying? How the bill could be non reviewable? It was essentially blank checks to the people who fucked themselves over in the first place.

 

[V.V.V.V.V.]

Hence why there was a nice picture of a guy holding up a sign saying NO BLANK CHECKS recently on CNN.com iirc.

 

[The Ozzman]

The bill was initially non-reviewable, but that was one of the major things that the representatives wanted to change (They wanted oversight whereas Paulson didn't)

I'm taking out about 400 dollars today from my account. I will take out more if shit continues to hit the fan.

 

[Zephyrus]

I'm still on the fence with this issue. I agree that we need major government intervention in the economy, but to do so at the taxpayers' expense isn't too inviting. All so a few hundred CEO's don't have to sell their megayachts?

 

[The Ozzman]

I'm still on the fence with this issue. I agree that we need major government intervention in the economy, but to do so at the taxpayers' expense isn't too inviting. All so a few hundred CEO's don't have to sell their megayachts?

It's beyond the point of the CEOs keeping their yachts now. This is the future of a country at stake.

 

[General Zaroff]

If shit hits the fan, I'm moving in with Krig.

 

[Alter]

...and Leftover Crack was right again.

I know nothing about the economy in much depth. Someone give me a detailed summery of what is happening.

 

[The Ozzman]

...and Leftover Crack was right again.

I know nothing about the economy in much depth. Someone give me a detailed summery of what is happening.

You have the internet at your disposal.

 

[viewerfromnihil]

i'm officially ashamed of my government

 

[zabu of nΩd]

I know nothing about the economy in much depth. Someone give me a detailed summery of what is happening.

A bunch of companies got into the habit of giving loans to people with shitty credit, and eventually those people weren't able to make the payments on their loans, so the companies who lent the money ended up severely broke, and if the government doesn't bail them out, a shit-ton of other people who actually put money into those companies will never get their money back. Also, a ton of people would lose their jobs because of all the companies that would get shut down due to the missing money.

So now Congress is trying to hammer out a plan to save the companies upon which so many people's money depends, and the first few proposals have been rejected.

 

[viewerfromnihil]

A bunch of companies got into the habit of giving loans to people with shitty credit, and eventually those people weren't able to make the payments on their loans, so the companies who lent the money ended up severely broke, and if the government doesn't bail them out, a shit-ton of other people who actually put money into those companies will never get their money back. Also, a ton of people would lose their jobs because of all the companies that would get shut down due to the missing money.

So now Congress is trying to hammer out a plan to save the companies upon which so many people's money depends, and the first few proposals have been rejected.

^this is all bill clinton's fault. people want to blame bush, the recession isn't his fault. for anyone who doesn't believe me research it. and now our fucking congress won't pass a bill that would significantly help us. why? because it's got bush's name on and they don't want to risk losing votes. it's bull shit

 

[zabu of nΩd]

One thing I'm still in the dark about is why the bill isn't getting passed. Most news doesn't go into detail about it. From what I've heard from various people, the first proposal was shut down because it was essentially a giant blank check to the CEOs, while the failure of the second proposal might have been more due to partisan bickering.

 

[The Ozzman]

It was due to Nancy Pelosi being a bitch.

Anyway, this isn't just Clinton's fault. It's Greenspan's fault, it's Bush's fault and it's Bernanke's fault as well (among others)

 

[viewerfromnihil]

well there are multiple people involved but i blame it on clinton for the most part because he helped a bill get through that allowed people who couldn't afford houses to buy houses... it helped the economy for a couple years until all of those houses got foreclosed on. hell, it allowed people on welfare to get house loans

 

[The Ozzman]

I don't think people on welfare were getting house loans, but okay.

 

[viewerfromnihil]

I don't think people on welfare were getting house loans, but okay.

i know it sounds ridiculous but, trust me, i know from almost first hand experience. one of my previous stepdads (i've had quite a few) was dirt poor and so was my mom and they were both on welfare. anyways, long story short, he got a house loan. oh and this was during the clinton administration, right before 2000.


it could also have to do with the fact that i was in ohio at the time and every one in gurnsey county and noble county (where i grew up) was dirt poor but, either way... giving house loans to welfare recipients? wtf?