Bailout Politics Weighed

Senate May Go First on Bill

Posted September 30, 2008 at 6:59pm

House and Senate leaders spent Tuesday attempting to strike a delicate balance between securing 12 more House votes for a Wall Street rescue plan while holding on to the solid support the measure already has in the Senate and the 205 votes it already received across the Dome.

Senate Majority Leader Harry Reid (D-Nev.) Tuesday evening set the stage procedurally for the Senate to go first and take up the bill tonight.

After the House’s stunning defeat Monday of the $700 billion plan for the government buy-up of “toxic” mortgages to ease credit markets, talk among leaders of both parties turned to what minor tweaks could be made to the package to guarantee a bare majority for the measure in the House.

“If you add something, you have to make sure you’re not losing anyone,” one House GOP leadership aide said. “If you’re at the 1-yard line and it’s fourth down, you can’t afford to fumble the ball.”

Senate Democrats and Republicans agreed that the changes had to be minimal and effective.

“We won’t re-create the wheel — too much work went into getting as far as we did,” one Republican Senate leadership aide said. “Something may be done around the edges, but we’ve got to be careful not to upset the apple cart.”

Bicameral talks — mostly by phone — are expected to continue today. House Majority Leader Steny Hoyer (D-Md.) and Minority Whip Roy Blunt (R-Mo.) are expected to talk this morning. Senate Republicans and Democrats also are expected to hold caucus lunches today to discuss the road ahead.

A House Democratic leadership aide cautioned that Democrats would not add new provisions without firm assurances that House Republicans would add to their vote total.

“We can’t bring a bill up that’s not going to have a guarantee from Republicans,” the aide said.

Even if Congressional leaders decide today whether to add provisions, House aides said no final decisions would likely be made until Thursday at the earliest, when Members will return from the brief midweek break and have time to review any new leadership proposals.

Democrats and Republicans in the House said the focus was squarely on the GOP, with Democrats explaining that they have nearly maxed out their support in that chamber for the bill.

“They’ve got a lot more room to go up than we do,” another House Democratic leadership aide said. “We both have a certain number of Members that will never support this bill. The bulk of the new additions will have to come from the Republicans because of the math.”

Still, the proposals being floated — including another extension of unemployment benefits — could serve to draw in a few more Democrats as well, the aide conceded.

“There are some Members with voter’s remorse, and it would give them something to point to that would be a ‘Main Street’ addition,” said the staffer, who added that might be true as well for vulnerable Republicans. However, Senate Democrats warned that adding unemployment insurance could imperil some Senate GOP support.

In that chamber, Majority Leader Harry Reid (D-Nev.) and Majority Whip Dick Durbin (D-Ill.) spent part of Tuesday calling Members of their caucus to gauge their support for the proposal and determine whether Senate Democrats would be willing to take up the rescue package before the House gives it a second look. Reid in particular is looking to ensure passage of the bill this week, and he wants to make sure — if the Senate does decide first — that he has a legislative vehicle the bailout bill could ride on.

With that in mind, the top Democratic leaders have been exploring whether they would have support to attach the $700 billion proposal to a package of popular energy tax credits. It remains unclear, however, whether Senate Democrats would be willing to embrace the plan, or the idea of moving ahead of the House.

“There’s no value in doing it,” one Senate Democratic aide said. “There’s no reason our guys should walk the plank with all the alligators down there. It would be different if there were rowboats.”

Reid spokesman Jim Manley declined to comment on whether his boss had surveyed the rank and file. But earlier in the day, Manley acknowledged Senate Democratic leaders were trying to stay flexible: “Democrats will look at all options to move forward on a rescue proposal that prevents a serious economic crisis, bring much-needed oversight and transparency and protects taxpayers. But we will need Republicans and Democrats alike to work together in a bipartisan fashion to get this done.”

Senate Republican leaders also were touching base with their Conference through much of the day, with the goal of keeping Members abreast of negotiations and taking the party’s pulse.

According to one leadership aide, while Minority Leader Mitch McConnell (R-Ky.) was talking to GOP lawmakers all day, it was unlikely any final decisions on where the Conference stood would be made until today.

“McConnell and the leadership team have been in constant contact with the Conference about this issue so that everyone is kept up to speed. There were meetings last weekend and calls that are ongoing. They will be having a lunch tomorrow,” the aide said.

GOP Senators backing the bill also have been tasked with reaching out to their House counterparts to gauge their flexibility in voting on a new proposal before the end of the week. Sen. Bob Bennett (R-Utah), a senior member of the Banking, Housing and Urban Affairs Committee, along with Minority Whip Jon Kyl (R-Ariz.), were among those said to be spearheading the outreach efforts.

One Senator noted that while “you’ve got a group of Republicans that oppose the bill that you’re just not going to get,” there are a number of “gets” that GOP Senators have been speaking with in the wake of Monday’s House vote. But the lawmaker noted that the effort has been challenging since House and Senate leaders have yet to settle on a concrete plan and have nothing firm to present to prospective supporters.

Still, some progress was in the works. Lawmakers in both parties and chambers appeared to be embracing the addition of a provision that would increase the amount of deposits the Federal Deposit Insurance Corp. guarantees from $100,000 to $200,000 or higher. One senior Senate Democratic aide said the chances of that proposal being added to the package was “90 percent,” given it is also supported by both presidential candidates.

Whether that will be enough remains unclear. House Minority Leader John Boehner (R-Ohio), who needs to help persuade more than 65 Republicans to come aboard any final product, called the proposal a “positive step,” but he cautioned that more would be needed to win over more Members in his Conference. Boehner also said in a statement that House Republicans want a provision that would force changes in standard accounting practices for businesses so companies would not have to value assets they planned to hold onto at current market prices.

John Stanton contributed to this report.