House votes against $700 billion rescue package

Ruth Mantell & Steve Gelsi
MarketWatch
September 29, 2008

WASHINGTON — House lawmakers voted 205 to 228 Monday against approving the historic $700 billion financial rescue plan, a sharp blow to the administration and bipartisan rallying efforts from leaders in Congress who warn that the country is on the brink of an economic precipice.

With elections approaching, some lawmakers — both Democrats and Republicans — may feel nervous about voting for a plan that risks so much taxpayer money and can’t promise success. But the president has lobbied hard to approve the plan, and U.S. officials also have stressed the dire consequences of taking no action.

Critics say the plan does not adequately address problems such as job losses and a distressed housing market that underlie current economic weakness. U.S. officials had hoped the plan would ease the credit crunch and restore confidence in the markets, even as markets plunged around the world. Those in favor of the rescue plan may have been trying to treat the most manageable symptom — a frozen credit market — if not the actual disease.

A vote in the Senate was expected Wednesday, and the president would have followed with a speedy signature.

Earlier Monday, doubt emerged over whether enough representatives would vote in favor of the plan and House Speaker Nancy Pelosi appealed to colleagues in the early afternoon, stressing that representatives will continue to monitor financial issues and pursue additional strategies. She said it’s imperative that the measure on the floor receives bipartisan support.

“That is the only message that will send a message of confidence to the markets,” Pelosi said.
Colleagues applauded after appeals for bipartisan agreement on the rescue plan from Rep. John Boehner, House minority leader, and Rep. Barney Frank, chairman of the financial-services committee.

The risk of not acting is much higher than the risk of acting, according to Boehner.
“I didn’t come here to vote for bills like this. Let me tell you this: I believe Congress has to act and that means each and everyone of use,” he said.

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This article was posted: Monday, September 29, 2008 at 1:27 pm

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