Risk & Compliance

White House Works to Pass Senate Bill

Bush expresses full support for the financial bailout to be voted on tonight; says support in Congress is growing after House's rejection.
Roll Call StaffOctober 1, 2008

The White House expressed its full support today for the Senate financial bailout bill to be voted on tonight, asserting that support in Congress for the plan is growing amid changes to the legislation and constituents’ complaints about the House’s failure to approve the plan.

White House Deputy Press Secretary Tony Fratto said changes to the House bill, including an increase in the Federal Deposit Insurance Corp. coverage for bank deposits, is helping build support. He said the addition of tax extenders to the package should also serve as a sweetener, though he acknowledged that some in the House object to the lack of offsets. The White House sides with the Senate and opposes offsets.

“We greatly appreciate the leadership of [Senate Majority Leader Harry Reid and Senate Minority Leader Mitch McConnell] to modify the bill…in a way that we believe significantly improves the chances of it ultimately being passed by both chambers,” Fratto said.

In the wake of the House vote, lawmakers’ phones are under siege from voters who believe the measure should be passed, he said, a change from the call volume against the legislation before the vote.

Fratto also said anecdotal reports of small businesses and localities unable to obtain credit are altering perceptions that the package is intended to rescue Wall Street and not the broader economy.

President Bush this morning has been working the phones to senators, urging those on the fence and opponents to get in line behind the measure. The president is meeting with Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke at lunchtime and intends to continue making calls this afternoon.

Asked whether Republican presidential nominee Sen. John McCain of Arizona had insisted on the FDIC measure, Fratto said both presidential candidates — McCain and Sen. Barack Obama (D-Ill.) — spoke with Bush about the provision.

On the House side, Rep. John Shadegg (R-Ariz.) signaled Wednesday that changes being discussed for the Wall Street bailout could prompt him to change his vote and support it.

Shadegg, interviewed on Arizona radio station KTAR, said raising the FDIC insurance cap from $100,000 to $250,000 and suspending the SEC’s mark-to-market accounting rules would likely win his vote. “If they make both of those changes, I’d be inclined to vote for the bill, assuming there have not been any bad things added to it,” he said.

The switch would be a major boost for Republican leaders — Shadegg is a former chairman of the Republican Study Committee, the conservative wing of the conference that helped sink the bill on Monday when 81 of its 106 members voted against it.

In the interview, Shadegg said he is “highly optimistic” the package will pass on its second try this week.

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