The U.S. House of Representatives on Monday declined to approve the Emergency Economic Stabilization Act of 2008. Congressman Zach Wamp was among those opposing the $700 billion financial bailout bill.
There were 228 opposed and 205 in favor in the House.
In the Senate, Sen. Lamar Alexander pleaded for passage of the bill, saying if it does not there is "a real risk that credit will freeze and Americans will not be able to get car, student, auto, mortgage, or farm credit loans – or even to cash their paychecks.”
He said, “Inaction in this case is not an option. The Senate will stay here and keep working in a bipartisan way to address the national credit crunch. Without decisive Congressional action there is a real risk that credit will freeze and Americans will not be able to get car loans, student loans, auto loans, mortgage loans, and farm credit loans – or even cash their paychecks. Next week we can fix the blame. This week we need to fix the problem.”
Rep. Wamp said, “While I am deeply concerned about the economy and the long-term viability of the nation’s markets as they relate to protecting small business, honest taxpayers and those saving for retirement, a vote today against the proposed ‘bailout plan’ is a vote for the people who did not issue or accept a sub-prime mortgage, for the people who demand more accountability than this bill provides and for the people who know that profit is a double-edged sword.
"When coupled with responsibility, profit is a healthy American virtue, but if people are driven to seek profit at any cost, it can wreck economies and ruin lives.
"C.S. Lewis once wrote, ‘We all want progress, but if you're on the wrong road, progress means doing an about-turn and walking back to the right road.’
"I came to Congress as a limited government conservative with a big heart for the common man who pays his own way, respects the Constitution and expects our leaders to do the same. We simply cannot borrow our way out of debt, spend our way into prosperity or explain this bailout as anything short of an unacceptable intervention of the federal government into our private sector.
"We must restore true confidence to the marketplace, which cannot be done by passing one bill through Congress. I am prepared to stay in Washington as long as it takes to help resolve this crisis by enacting sweeping reforms to the financial world that does not fall on the backs of the taxpayers and future generations.”
Sen. Alexander said, “Congress should approve the amended plan without delay – today. If the House can pass it today, there is no reason why the Senate cannot pass it today and send it to the president.
“The whole point of the work over the weekend – since last Thursday, in fact – was to do everything we could to protect taxpayers. Under the amended plan, the Secretary of the Treasury will have authority to buy and sell troubled mortgage assets to get the economy moving again. Taxpayers will have authority to provide oversight, minimize losses, and make sure profits go to reduce debt. Most realize that the largest reason for this emergency legislation is mortgage loans that people can’t pay back and securities based upon those mortgages. This has derailed housing and created problems for banks. It has spread uncertainty and caused people with cash to be cautious.
“This has come so fast and taken such an unexpected turn that it is hard for most Americans to know what to think about it. Think about it as someone who should have known better dumping thousands of bad mortgage loans and other assets in the middle of an eight-lane interstate, threatening to bring to a halt all economic traffic.
“Vehicles carrying these essential credits that Americans rely on every day have ground to a halt on the economic highway, blocked by a big pile of bad mortgage loans. So we end up with this massive wreck in the middle of the economic highway.
“Think of the federal government as the salvage crew and Secretary Paulson as the driver of the wrecker. His job is to buy the salvage and get it off the highway as soon as possible so the traffic can start moving again. If he does this, then the lanes will open again, and the vehicles carrying your auto and car and mortgage and farm credit loans and payroll checks will start moving again.
“And think of yourself, the taxpayer, as the owner of the salvage company – doing everything possible to make sure the driver of the wrecker can get the pile of bad loans off the highway and sell them for at least as much as it cost him to pick them up.
“Most realize now that we are not spending $700 billion. The Secretary may buy up to $700 billion in troubled mortgage assets – enough to restore confidence – but he may buy much less. Over time, he will then sell these assets. There might even be a profit which, under the plan, would go to reduce the federal debt.
“This week – today – we need to fix the immediate problem. Clean the wreck off the highway. Next week we need to begin to take steps to remodel our regulatory agencies – most of which were designed to deal with the calamities of the 1930s. And we need to find out if there was fraud or misleading actions so that we can do our best to make sure this doesn’t happen again.
“Next week can fix the blame. Today we should unclog the economic highway and fix the immediate problem to make sure Americans can buy homes and cars and houses, go to college, get farm credit loans, and cash their payroll checks.”