WASHINGTON — Saying the nation's economy is on the line, congressional leaders are pushing for a vote today on a $700-billion plan to end the financial system's paralysis and protect taxpayers from having to bear the cost.
The 110-page bill that goes to a House vote today and a Senate vote as soon as Wednesday contains key measures demanded by both parties. Among them: curbs on executive pay, an oversight board and a chance for taxpayers to share in potential gains.
"No longer will the U.S. taxpayer bail out the recklessness of Wall Street," said House Speaker Nancy Pelosi (D-San Francisco).
The plan builds on the Bush administration's original three-page proposal to buy up securities tied to troubled home loans. The huge losses from these securities have brought the financial system to its knees -- pushing giant investment banks into collapse, making credit harder to obtain and roiling global markets.
Still, despite the endorsement of the leaders of both parties, the deal faces strong opposition, and it remained unclear Sunday whether it would have enough votes to pass.
At the center of the rescue plan are two programs designed to buy up and establish prices for the mortgage-backed assets. One program would permit the government to purchase the troubled securities and hold them until they regain value, and the second would set up a government insurance program to guarantee the value of some assets.
Lawmakers worked hard to dispel the popular impression that the plan would rescue wealthy financiers who made fortunes pushing tricky investment schemes and stick ordinary Americans with the bill.
"You've heard all this hyperbole . . . that we're throwing $700 billion at Wall Street. That simply isn't true," said Sen. Judd Gregg (R-N.H.), the top Republican on the Senate Budget Committee and one of his party's lead negotiators. "We may lose some money, we may break even or we may make some money. My gut tells me we'll make money."
Presidential nominees Sen. Barack Obama (D-Ill.) and Sen. John McCain (R-Ariz.) both tentatively endorsed the plan in appearances on Sunday news programs.
"This is something that all of us will swallow hard and go forward with," McCain said on ABC's "This Week." "The option of doing nothing is simply not an acceptable option."
"[If] this is not going to be welfare for Wall Street, then my inclination is to support it because I think Main Street is now at stake," Obama said on CBS' "Face the Nation." "This could affect every sector of the economy."
At least some House Republicans who protested the plan last week expressed reluctant support after negotiators incorporated their demand for an insurance program as well as a purchase program.
"More and more people are coming around to it," Rep. James T. Walsh (R-N.Y.) said as he left a closed-door debate among his colleagues. "It's not a pretty option, but it's the best option."
At a Democratic "skeptics" caucus, Rep. Brad Sherman (D-Sherman Oaks) described the attitudes as ranging from "hold your nose and vote yes, to vote no, to scream no."
"If it's take it or leave it, we should leave it and try again," said Rep. Dennis J. Kucinich (D-Ohio), one of about 30 Democratic lawmakers who filed into a basement to hear economists critique the proposal.
Lynn Turner, the former chief accountant of the Securities and Exchange Commission, was also critical.
"History will be the judge of whether this bet by Congress pays off or not," he said. "But given how high the stakes are, and the huge risk America faces, this was an extremely poorly made piece of sausage, and with everything that is in it, Americans may find it not very pleasant-tasting in the long run."
Pelosi went to great lengths to insist that the bill was neither a Democratic nor Republican product but a compromise that would draw opposition from both sides. She expressed hope, however, that enough members of both parties would vote for it to make it law within days.
"This is a bill that was sent by the president, improved by the Congress in a bipartisan way, and we will have to have bipartisanship to pass it," Pelosi said.
As the evening progressed, there were signs she was getting just that. Republican leaders emerged from a three-hour meeting with their caucus to tout the bailout, saying it had undergone a "giant improvement" thanks to their contributions.
"At the end of the day, there really are no taxpayer funds at risk here," said House Minority Leader Rep. John A. Boehner (R-Ohio), referring specifically to the insurance plan. "What is at risk is the U.S. economy. And that's why we're supporting this bill."
The bipartisan support is expected to be well-received on Wall Street, though the package comes with more strings attached than the financial industry would like. Approval should also spell relief for the credit markets, which had congealed in the last two weeks as anxious banks hoarded cash and rates on normally routine short-term loans skyrocketed.