Last night the Senate passed a bailout bill that was somewhat different from the version the House rejected on Monday. The Senate vote was 74-25 (roll call here), with Chuck Grassley and Tom Harkin both voting in favor.
Last week Harkin had spoken out against the original bailout proposal, so obviously he was satisfied with the changes made. (UPDATE: Harkin’s statement explaining his vote is after the jump.)
Both Barack Obama and John McCain voted for the bailout last night. Today, Obama made the economy the centerpiece of a campaign speech in Michigan. Click here to read the speech and watch video clips.
Congressional candidate Becky Greenwald, who said on Monday that she would have opposed the House version of the bailout, issued a statement urging Tom Latham to support the Senate version when it comes back to the House:
“I strongly encourage Tom Latham to support this new version of the financial rescue bill. The Senate version of the bill integrated constructive changes including temporarily raising the FDIC insurance caps, renewable energy tax credits and fixing the Alternative Minimum Tax to exempt middle-income taxpayers. These provisions go a long way to support working families in the 4th District, who were forgotten in the original bill.
“I still think more needs to be done to address the underlying problem of keeping families in their homes, but it is clear by the impending unavailability of credit, we need to take action now. I am encouraged by the modifications to this bill. I hope the House will embrace the modified bill. I encourage Tom Latham to vote in favor of this bill and take this important step in addressing our financial crisis.”
Congressional candidate Rob Hubler, who said on Monday that he would have voted for the bailout in the House, posted this statement on the front page of his website:
“The failed economic policies of the Bush administration, supported consistently by Steve King, combined with the lack of common-sense regulations and oversight by Congress has led us to this financial train-wreck.
“Six years ago, the Bush administration sought authorization to use military force to invade Iraq. We acted too quickly and became mired down in war. Today, it is asking for authorization to use financial force in the market place. We must not make the mistake of acting too quickly without enough information, and we must address the problems of Main Street as well as Wall Street. The revised proposal includes subsidies to support the production of ethanol and wind energy, which will be helpful to Iowa’s economy.
“By raising the insurance level from $100,000 to $250,000 for savings accounts, we will help small-town bankers survive the current financial crisis. If the revised version of the rescue package provides that taxpayers will be paid back every dime of the billions it will take to avert an extended recession and gets money to people on Main Street, I would reluctantly vote in favor of the legislation in order to stabilize the economy so that families and businesses on Main Street are not further affected. I am encouraged that both Senators Obama and McCain are now working toward a solution, while Steve King is still pushing failed policies, such as eliminating the capital gains taxes which favor wealthy Wall Street speculators. Main Street doesn’t have any capital gains to pay taxes on right now.
“If I am elected to Congress. I will be a strong voice in favor of regulatory measures and vigilant oversight-unlike Steve King-to see that checks and balances are put back in place so that we never have to experience this kind of calamity again.”
Speaking of Steve King, he made news yesterday during a talk radio show. He argued that McCain was right to say the fundamentals of our economy are strong. I didn’t watch Keith Olbermann’s Countdown show last night, but apparently King earned the title of third-worst person in the world for the day.
I haven’t had a chance to read up on the specific improvements made in the Senate bailout bill. I am skeptical that this will solve the problems in the banking sector, however. Senator Russ Feingold of Wisconsin issued this statement explaining his opposition:
“I will oppose the Wall Street bailout plan because though well intentioned, and certainly much improved over the administration’s original proposal, it remains deeply flawed. It fails to offset the cost of the plan, leaving taxpayers to bear the burden of serious lapses of judgment by private financial institutions, their regulators, and the enablers in Washington who paved the way for this catastrophe by removing the safeguards that had protected consumers and the economy since the great depression. The bailout legislation also fails to reform the flawed regulatory structure that permitted this crisis to arise in the first place. And it doesn’t do enough to address the root cause of the credit market collapse, namely the housing crisis. Taxpayers deserve a plan that puts their concerns ahead of those who got us into this mess.”
-Senator Russ Feingold, October 1, 2008
Former Labor Secretary Robert Reich expects the economy to continue to worsen with or without the bailout.
The economist/blogger Bonndad wrote a piece analyzing the various bailout proposals. He concluded, “As far as I have seen, no one has offered any solution to the credit crunch that makes any sense. ”
This is an open thread for any comments related to the economy or the bailout proposals.
HARKIN STATEMENT REGARDING VOTE ON EMERGENCY ECONOMIC STABILIZATION ACT
WASHINGTON, D.C. – Senator Tom Harkin (D-IA) released the following statement today regarding his vote for the Emergency Economic Stabilization Act of 2008.
“I reluctantly voted in favor of this bill because I believe our nation’s financial system faces serious challenges, and it is important for us to act. However, I am under no illusions. I firmly believe that Congress should not have been rushed into this action, but we needed to do something to calm the markets and restore confidence in our economy. While this package will do that in the short term, we must modify it early next year to strengthen and improve the rescue framework – and I will be leading the charge to do that.
“Over the last week, I did my best to strengthen and improve this package, including demanding the creation of a Special Inspector General to oversee the emergency efforts of the Treasury Department, and to investigate the any waste, fraud, and abuse as the bailout goes forward. I was pleased to see that this recommendation was included in the final bill.
“I also chose to support this bill because of the provisions that are vitally important to my home state, including tax breaks for Iowans and Iowa businesses recovering after the floods and tax benefits that will create new jobs in the wind and biofuels industries.
“This bill also includes the Paul Wellstone and Pete Domenici Mental Health Parity and Addiction Equity Act of 2008 that will help countless Iowa families by ensuring that mental health and addiction treatment are covered in the same way as other serious illnesses. My friend Senator Wellstone fought with his characteristic passion for mental health parity legislation, and I have been honored to carry on that fight.”