The concessions gained were not enough to reassure congressmen whose constituents overwhelming opposed the plan, writes Denis Staunton
REPUBLICANS and Democrats yesterday blamed each other for the rejection by the House of Representatives of a $700 billion financial rescue plan the White House claimed was needed to prevent an economic meltdown in the US.
George Bush and vice-president Dick Cheney spent much of yesterday morning calling Republican congressmen to urge them to support the Bill. In the end, however, more than two thirds of Republicans voted against the measure, which was backed by two out of three Democrats.
Leaders of both parties had wrung concessions from treasury secretary Hank Paulson in recent days, winning more oversight over how the plan would operate, capping the pay of top executives in firms that would receive financial help and adding a number of measures to help homeowners to avoid having their homes repossessed.
The concessions were not enough to reassure nervous congressmen, all of whom face re-election in November and many of whom had received hundreds of phone calls and e-mails from constituents, who were overwhelmingly opposed to the plan.
"We're all worried about losing our jobs," Wisconsin Republican Paul Ryan told fellow congressmen in his speech in support of the Bill. "Most of us say, 'I want this thing to pass, but I want you to vote for it - not me'. "
The vote was always going to be tight but Republican leaders claimed they had enough votes to pass the Bill before House speaker Nancy Pelosi made a speech about the $700 billion plan during the debate that raised Republican hackles.
"It is a number that is staggering, but tells us only the costs of the Bush administration's failed economic policies - policies built on budgetary recklessness, on an anything-goes mentality, with no regulation, no supervision, and no discipline in the system," Ms Pelosi said.
"Democrats believe in the free market, which can and does create jobs, wealth, and capital, but left to its own devices it has created chaos," said the top Democrat in Congress.
Republican leaders claim that, following Ms Pelosi's speech, 12 Republicans who had planned to vote for the Bill changed their minds and voted against it.
Democrats dismiss such claims, arguing that conservative Republicans were motivated by a mixture of free-market ideology and political cowardice.
"Because somebody hurt their feelings they decided to punish the country," said House financial services committee chairman Barney Frank.
Many Democrats are also unhappy about the bailout and some who face close races in November voted against it, along with many on the party's left who believe that federal funds should be channelled towards home-owners rather than financial institutions.
Ms Pelosi had always insisted that the Bill should have bipartisan support and she claimed yesterday that her party had lived up to its responsibilities.
"The Democratic side more than lived up to it's side of the bargain," she said. "The legislation has failed. The crisis has not gone away. We must work in a bipartisan way in order to have another bite at the apple."