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House Financial Services Committee Chairman Barney Frank (left) and Senate Banking Committee Chairman Christopher Dodd talk with reporters after a Sept. 18 meeting with Bush administration officials about a plan to rescue financial firms.
House Financial Services Committee Chairman Barney Frank (left) and Senate Banking Committee Chairman Christopher Dodd talk with reporters after a Sept. 18 meeting with Bush administration officials about a plan to rescue financial firms. Chip Somodevilla/Getty Images
Bush administration officials want Congress to approve a $700 billion aid package for Wall Street, and they want it to happen within days. Democrats say they're willing to help shore up the financial markets, but they want a bill that includes relief for homeowners and taxpayers as well.
Treasury Secretary Henry Paulson went from one Sunday TV talk show to another trying to explain why a deficit-ridden nation should go hundreds of billions of dollars deeper in debt — all to cover the bad bets made by some of the nation's wealthiest private firms.
Paulson's argument was simple: Things could get far worse should the U.S. not ride to the rescue.
"I have every confidence that Congress will go along with this ... that doesn't mean everyone in Congress will agree, it doesn't mean there won't be a healthy debate. But I am highly confident that we will get the authorities we need this week," he said on CBS' Face the Nation.
Rep. Frank Wants Economic Boost
Paulson said he not only wants congressional approval to be quick; he wants it clean — not to be loaded up with items he didn't request. Barney Frank, the Massachusetts Democrat who chairs the House Financial Services Committee, followed Paulson on CBS:
"Secretary Paulson and I have a lot of agreement, but we have a difference on what's clean," Frank said. "We don't think that trying to stimulate the economy given the 6-plus-percent unemployment — let's not forget other problems as we focus on this one — I don't think that dirties up the bill."
Frank wants the bill to limit executives' compensation at the financial firms getting bailed out. He also wants a special tax on those making over $1 million a year to help offset the cost of the bailout.
Another leading Democrat, New York Sen. Charles Schumer, seemed to throw cold water on Frank's wish list during an appearance on Fox News Sunday.
"We will not Christmas-tree this bill," Schumer said. "The times are too urgent. Everyone has their own desires and needs. It's going to have to wait."
But then Schumer pulled out his own wish list for a bailout bill.
"When I and others have talked to Secretary Paulson, he has said he is open to changes, and I would call changes necessary in three areas. I call them THO: taxpayers — they have to come first; homeowners — we have to do something about the mortgage crisis, not just foreclosures but the price of housing, which is affecting everyone on Main Street; and oversight — we need some accountability here."
'The Mother Of All Bailouts'
And it wasn't just Democrats saying Congress should take a closer look at what's in the bailout.
"This is the mother of all bailouts, and we don't see the end in it yet," said Richard Shelby of Alabama, the top Republican on the Senate Banking Committee. He told CBS that he expected the bailout would actually cost more than $1 trillion.
"We don't know the endgame in this, and I'll tell you, what bothers me about this is that I believe that the chairman of the Fed and the Treasury secretary, Paulson, with all due respect to them, they've been staggering from crisis to crisis, and they haven't even said today that this will end the crisis."
Other congressional Republicans are closing ranks with the Bush administration. House Minority Leader John Boehner told ABC's This Week it's time Congress rose above partisan politics, even on the eve of a fiercely fought election:
"We don't need 535 members of Congress adding their best idea to this bill," Boehner said. "We need to keep it clean, simple, move it through the House and Senate, and get it on the president's desk."
Jon Kyl of Arizona, the Senate's No. 2 Republican, told Fox he's optimistic the bailout plan will move through Congress in time for lawmakers' planned adjournment.
"I think the chances are better than 50-50 that we'll get it done by the end of the week, and hopefully it won't be bogged down with too many extraneous and costly provisions," Kyl said.
That was before House Speaker Nancy Pelosi (D-CA) issued a defiant statement Sunday night. "We will not simply hand over a $700 billion blank check to Wall Street and hope for a better outcome," she said.