WASHINGTON -- Congressional leaders raced Thursday to round up support for a financial- rescue bill on the eve of crucial vote today in the House of Representatives, expressing cautious optimism that House members will reverse themselves and pass the measure.
The Senate approved the bill by a lopsided 74-25 vote Wednesday night. It was a revised version of the Bush administration's $700 billion Wall Street bailout plan that the House rejected 228-205 on Monday. The Senate bill retained the $700 billion bailout and added $110 billion in tax breaks over 10 years to encourage more lawmakers to vote for it.
Bush administration officials and other supporters were hopeful that the Senate additions and continued turmoil in the economy will prompt enough House lawmakers to change their minds and vote for the bill today.
"I think we'll get them," said House Majority Leader Steny Hoyer, D-Md. House leaders said they'll bring the bill to a vote today if they determine there are enough votes to pass it.
House Speaker Nancy Pelosi, D-San Francisco, embraced the Senate's revised measure, saying the inclusion of alternative energy incentives and tax breaks for ordinary citizens could help boost the plan's appeal.
Rep. Charles Rangel, D-N.Y., chairman of the tax-writing House Ways and Means Committee, said he plans to vote for the measure despite reservations about the Senate bill, and said he's "very confident that the votes will be there" to pass the legislation.
As House members returned to Washington after a break for Rosh Hashanah, the Jewish holiday, the outcome nevertheless remained uncertain. The House rejected the original bill with 95 Democrats joining 133 Republicans to oppose what they perceived as a bailout for Wall Street fat cats.
"It's only gotten worse," said Rep. Mike Ross, D-Ark, leader of a coalition of 47 fiscally conservative Democrats known as the Blue Dogs. Although 25 members of the coalition supported the original bill, Ross said "there is a lot of heartburn" among Blue Dog members because the added tax cuts that will worsen the federal deficit.
Consequently, he said, the Senate action took "25 yes votes and potentially changed them to no votes."
Still, he said that many members of the caucus, including himself, are struggling to decide their ultimate position in the face of Democratic leadership appeals that the bill is vital to reverse the nation's economic slide.
Phone gets a workout
Republican leader John Boehner, R-Ohio, worked the phone to coax votes from Republicans who initially opposed the bill.
"We're working hard," said Boehner spokesman Michael Steel. "I think we're making progress."
But asked if there would be enough Republican reversals to make a difference, Steel said, "That's an excellent question."
Rep. Gresham Barrett, a South Carolina Republican, declared late Thursday that he would switch sides and vote today for the rescue plan.
"If Congress does not act, the effects will be serious for American small business, families and consumers," Barrett said. "While this bill continues to contain a number of provisions that I oppose, I believe we are at the end of the legislative process and action is required."
The Senate's addition of $110 billion in tax breaks helped the measure gain passage there, and supporters were hoping the incentives would have the same impact in the House. But there was also concern that the deficit-expanding additions would anger fiscal conservatives, including 47 Blue Dog Democrats.
Leading Republican opponents showed no signs of wavering.
"I'm a firmer no," said Rep. Joe Barton, R-Texas. He said the sweeteners in the Senate bill were nothing more than an attempt to "bribe people to vote."
However, Rep. Ileana Ros-Lehtinen, R-Fla., who voted against the bill Monday, said she plans to vote for the Senate version because it now includes more relief for families, including reinstating the college tuition tax deduction and energy tax credits.
Pension plans hit home
Monday's record 777-point decline in the Dow Jones industrial average immediately after the first House vote could prompt many House members to change their minds because of the decline in value of their constituents' stock-based pension plans, Rangel predicted.
Hoyer said that phone calls to his office were running 6-to-1 against the bill before the House vote, as angry taxpayers complained that they were being asked to pay for damage wrought by excesses on Wall Street.
However, the public's attitude shifted after many constituents saw their retirement funds hammered by the stock market drop, Hoyer said, with phone calls running only 3-to-1 against the bill since the House vote.
"People saw on Monday that it had a direct impact on them," Hoyer said. Although the market partially recovered the following day, the Bush administration and congressional leaders say the rebound is only temporary and predict that the financial crisis will worsen unless the bill is passed.
On Thursday, the Dow slid 348 points, closing not far from where it ended Monday.
Like the legislation the House rejected Monday, the Senate bill would create a $700 billion federal program to buy sour assets from banks and other financial firms at a steep discount. The hope is that the government would recoup much or all of that money by selling the assets later, once stability returns to the financial world.