Stephanopoulos: What's Next? Congress Mulls Four Options

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Stephanopoulos: What's Next? Congress Mulls Four Options

September 29, 2008 7:05 PM

ABC News' George Stephanopoulos reports: There are meetings going on right now on Capitol Hill to try to figure out what to do about the $700 billion Wall Street bailout bill that failed to pass the House today.

Congressional sources tell ABC News that what they're talking about right now are three or four basic baskets of options:

# 1 -- Muscle Bailout Bill Through House: Some leaders suggest those House Republicans on the fence will be swayed by seeing what the markets do tomorrow, which could be more bad news. The Dow Jones Industrial Average dropped over 700 points today as the administration's bailout bill failed in Congress This option would see House leaders try again to muscle through the votes they need to get the $700 billion bailout bill passed.

#2 -- Pass Bailout in Senate First: Some Senate and House leaders have been talking about letting the Senate go first and pass the bailout package, ABC News has learned. There appears to be broader support in the Senate for the bailout package. This option would see the Senate vote first which would increase the pressure on the House to pass the Bush administration's bailout bill.

#3 -- Make Small Tweaks to the Bill: Congressional leaders wonder if perhaps there are a couple of small tweaks they can make to the package that would bring along the 12 votes they lost the vote by. Option A, sources say, could be adding a line that some economists have said is absolutely necessary for the FDIC to guarantee all deposits in transaction accounts, not just up to $100,000. That would deal with the credit crunch and it would be quite popular, some on Capitol Hill argue. Option B would be eliminating the mark-to-market rule that many Republicans and conservatives complain about, which ensures financial decision-makers must show their losses in real time.

#4 -- Get More Democrats On Board: Finally, one other unlikely option talked about on Capitol Hill is to try to pass the bill almost entirely with the Democratic majority in the House. That would require adding a major stimulus package favored by Democrats, infrastructure spending, unemployment insurance spending, and heating and food stamp assistance for low-income Americans.

All of that is being discussed right now. We're not likely to hear members have landed on any single proposal until at least tomorrow.

Nothing will be done for at least a day and a half as Congress is in recess because of the Jewish New Year. The Senate won't be back until Wednesday afternoon and the House of Representatives is adjourned until Thursday.

However the bigger sell to Congress to do something may be the consequences of not acting. More bad news through the end of the week that might do it.

Bailout Politics

Everyone knew it was going to be a close vote, but we've never seen anything like this.

There was a Republican president, a Democratic Speaker of the House, a Democratic majority leader, the entire Republican and Democratic leadership from both sides of Congress and both presidential candidates Barack Obama and John McCain arguing for this package.

But a peek at the upcoming congressional races of the people who voted against this package provides some insight.

We calculate there are about 31 competitive House races divided between Democratic and Republican House members, and 24 of the 31 members in competitive districts voted against this package.

No one wants to vote for this. Even those who were arguing for it on the House floor today said 'we know this package is painful, we know it's hard to argue that we should be spending up to $700 billion in a way that might end up benefiting the banks.' It's a hard pill to swallow despite the arguments about what's its going to mean for Main Street.

However the fundamental problem for Republicans is that in an election year when the incumbent is not on the ballot, but you've had eight straight years of Republicans in the White House, any bad economic news is likely to fall harder at this point on Republicans.

Obama called on Congress to get the bill passed and McCain blamed Obama and House Speaker Nancy Pelosi for injecting what he called "unnecessary partisanship" into the equation.

Many Republicans are complaining about a floor speech Pelosi gave prior to the vote, where she laid so much of the blame on eight years of Republican economics and President George Bush's policies.

The Democrats are arguing it's unbelievable that hurt feelings would prompt the Republicans to switch their vote and perhaps cause an economic disaster.

Neither presidential candidate has given any indication that they are going to suspend their campaign and run back to Washington, DC to deal with this. However it's likely well see both Obama and McCain in Washington in person when that vote finally comes.

September 29, 2008 in McCain, John, Obama, Barack, Vote 2008: Democrats, Vote 2008: Republicans, Washington | Permalink | User Comments (458)

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How can it be that the two guys who got it so wrong right up until we were in the middle of this mess (Paulson and Bernanke) testify before both houses, but neither body saw fit to seek counsel from even one of the many independent economists who've all had it right for so long?

Posted by: Redwood | Sep 29, 2008 7:48:01 PM

NO Bailout for wallstreet

That is a real plan.

Posted by: Duane Z | Sep 29, 2008 7:49:40 PM

Carol & Lord Help Liberals - stop talking to yourself. It is so sick that you feel the need to make a fake person to respond in your favor.

Posted by: caroltoo | Sep 29, 2008 7:50:22 PM

Yipee!! The great depression 2.0 starts the day after 29-9, *cries*

Posted by: thedayafter | Sep 29, 2008 7:50:26 PM

Caroltoo - well said

Posted by: carolthree | Sep 29, 2008 7:50:54 PM

ABC - Please list the 12 + House Republicans at the Press conference with Cantor of Virginia who chose not to vote for the bill only because their feelings got hurt. They have no place in Congress if they have such thin skin and their are quite of few of us that would like them to find employment elsewhere.

Posted by: Take a hike GOP | Sep 29, 2008 7:51:24 PM

Did I hear election rigging? Oh never mind. There is also a solution. POWER SHARING. Obama-President, McCain, Prime minister. Lol :)

Posted by: thedayafter | Sep 29, 2008 7:53:55 PM

Blame lies at republican feet, they killed this, now they try and deny that fact. Gutless, irresponsible, political assholess the lot. Come November, remember who killed our economy. the neo-cons.

Posted by: JR | Sep 29, 2008 7:55:33 PM

Let's leave McCain and his political opportunism (look like he's fixing the bailout = economic boost)out of the next round of talks, shall we?

http://www.political-buzz.com/

Posted by: matt | Sep 29, 2008 7:55:40 PM

Carol,

What Crap!

Posted by: Thinking | Sep 29, 2008 7:55:44 PM

This bail out is only a shock absorber, the crash will come sooner or laetr

Posted by: cathy | Sep 29, 2008 7:57:25 PM

Carol, I appreciate your satiric use of irony... but it might be lost on others.

George W. Bush inherited not a mess, but a record budget surplus. That surplus was the result of an economic plan that was passed by the Democratic Congress on a party line vote. Republicans warned of economic collapse: instead was saw an enormous economic expansion.

For 2/3 of his presidency, George W. Bush had a Republican Congress. Not a Democratic one.

And any disgrace brought to the White House by Clinton for his sexual escapade has been far, far, far exceeded by an administration that treasonously outed a CIA agent, invaded Iraq in retaliation for 9/11 by using trumped-up intelligence, and which officially sanctioned the use of torture - a policy that America had rejected from the time of the Revolutionary War.

Posted by: Malacandra | Sep 29, 2008 7:58:35 PM

LordHelpLiberals said: As for the war, are you idiots not remembering the attack on September 11th?!?

You mean the attack that had NOTHING WHATSOEVER TO DO WITH IRAQ?

Yeah, I remember it - I lived 5 blocks away. And I am still pissed off at GWB for dropping the ball in Afghanistan, and letting OBL escape - just so he could get some payback for daddy in Iraq. And then not even do that war correctly. Talk about screwing the pooch; Bush screwed the whole kennel.

Posted by: Matt V | Sep 29, 2008 7:58:42 PM

Bill Clinton left a 5 trillion surplus,Lil Bush had a Republican Congress for the first 6 years,and were 10 trillion in debt now.All Bill Clinton did was get a BJ from a fat girl, big deal. Please don't make me defend Dem's. And Reagan was an idot, he is the reason alot of people lost there money today in 401k's instead of having there money in a savings account.

Ex Republican

Posted by: RGeier | Sep 29, 2008 8:00:41 PM

I need to correct a factual error in my previous post: by the time George W. Bush leaves office, he'll have had a Republican Congress for 3/4 of his presidency (75%). Not 2/3 (66%).

Blaming Democrats for the failure of this most miserable administration is simply untenable.

Posted by: Malacandra | Sep 29, 2008 8:01:13 PM

You idiotic Republican's that oppose the bail out for ideological reasons deserve to lose your 401k's. I sure will not feel sorry for you when your out on the Street with nothing but the clothing on your back. You are too dumb to realize that this is going to hurt everyone--regardless of who is to blame (obviously Republican's who caused this mess and Wall Street..duh). When you pull the lever to elect McCain, you can do it with the clear conviction that you put ideology before common sense and stupidity before reason.

Posted by: steve | Sep 29, 2008 8:05:54 PM

Nancy Pelosi gave a speech before the vote to derail the few Republicans needed for approval. Barack Obama continues campaigning and has done NOTHING to change the vote of some 93 democrats voting against the bailout---Obama has done nothing to rally full support of his own party!!!! Shock but no surprise. Both have none this to give Obama a lead and win the Election---neither care about America...just wealth and power.

Posted by: Ann | Sep 29, 2008 8:07:16 PM

Sorry, meant that previous one for Carol.

Carol is a little dim. If Clinton is responsible for Bush's problems, then Carter is responsible for Reagan's "success"

Posted by: Matt V | Sep 29, 2008 8:07:22 PM

And besides, Bill cliton created alot of jobs for Americans in the dry cleaning bussiness and still is I here. :) LOL

EX Republican

Posted by: RGeier | Sep 29, 2008 8:08:23 PM

Why can't there be an option #5 - Listen to the economists who say don't waste taxpayer money on the bailout - instead, eliminate the programs that caused this mess to begin with. It's cheaper and a faster way to fix this problem.

Posted by: Very Concerned | Sep 29, 2008 8:08:33 PM

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