House Leaders Bullish on Vote

Support Grows on Both Sides

Posted October 1, 2008 at 6:59pm

It’s Take II for the Wall Street bailout in the House, and leaders from both parties are gaining confidence that this time, the package will be ready for its close-up.

After Monday’s disastrous House vote sent markets plunging, prospects for a redo on the $700 billion package appeared to improve significantly Wednesday after Republican leaders and insurgents such as conservative Rep. John Shadegg (R-Ariz.) praised changes made in the Senate, and House Democratic leaders worked to keep their votes in line.

The changes to the bill — including the $150 billion of tax-cut extensions, the increase in Federal Deposit Insurance Corp. insurance cap from $100,000 to $250,000 and the decision to roll back Securities and Exchange Commission mark-to-market accounting rules — all appeared likely to win over Republican votes.

And the group most likely to defect over the changes — Blue Dog Democrats who have been demanding offsets for the tax cuts — did not seem to be bailing Wednesday.

Republican aides said some GOP Members who voted against the package are having remorse about their vote after going home and hearing from constituents angry that their investments suffered a massive hit on Monday when the stock market tanked.

Shadegg, interviewed on Arizona radio station KTAR, said raising the FDIC insurance cap and suspending the SEC’s mark-to-market accounting rules would likely win his vote. “If they make both of those changes, I’d be inclined to vote for the bill, assuming there have not been any bad things added to it,” he said.

The switch would be a major boost for Republican leaders — Shadegg is a former chairman of the Republican Study Committee, the conservative wing of the Conference that helped sink the bill on Monday when 81 of its 106 members voted against it.

In the interview, Shadegg said he is “highly optimistic” the package will pass on its second try this week.

House Majority Leader Steny Hoyer (D-Md.) said Democratic leaders would try to find the votes for the Senate package, and if they have the votes, would likely bring the package up for a vote on Friday.

Hoyer said he was disappointed that the Senate added the tax-extenders package without sufficient offsets, and he acknowledged some of the 25 Blue Dog votes for the package could be lost. But Hoyer said the overall economy takes precedence and dismissed the idea of trying to make changes.

“We don’t have time. The economy will not wait. The markets are skittish and fragile. … If we can get a majority in the House of Representatives, we need to move.”

House Democratic leaders are keeping a close eye on the fiscally conservative Blue Dogs, who have bristled for months at the Senate’s refusal to fully fund a package of tax extenders.

Some senior lawmakers in that group remained on the fence about the more expensive rescue package on Wednesday. Rep. Allen Boyd (Fla.), a co-chairman of the group, and Rep. John Tanner (Tenn.) both were undecided at press time, their spokesmen said. Rep. Dennis Moore (Kan.), another co-chairman, said in a statement he had “grave concerns” about adding to the cost of the overall bill. “But in this difficult time, I’m glad the Senate is moving on this much needed emergency economic rescue plan,” he said, stopping short of declaring his continued backing for it.

But others in the caucus of budget hawks said the gravity of the economic crisis is so great they cannot stand in the way of the rescue package, even if it violates their pledge to offset any new spending.

“If we want to preserve our modern economy, we’ve got to get through this rough patch,” Rep. Jim Cooper (D-Tenn.) told an editorial board meeting at the Nashville Tennessean on Wednesday. He said the added cost of the package was something lawmakers would have to swallow in what has become “a genuine national emergency.”

“We’ll have to look to fight that another day,” Cooper said.

Likewise, Rep. Jim Marshall (Ga.), a Blue Dog considered one of the most endangered Democrats in the House, “intends to continue supporting it,” spokesman Douglas Moore said. While he “doesn’t love” the Senate package, “there are more important things,” Moore said. More Blue Dogs indicated they will keep supporting the bailout — aides to Reps. Melissa Bean (Ill.) and Charlie Wilson (Ohio) said they will back the Senate measure.

Blue Dogs were expected to discuss the bailout on a 5 p.m. conference call Wednesday.

Democratic leaders hoping to scare up new supporters for the package among their own ranks will have trouble among the members of the Congressional Black Caucus. Eighteen CBCers voted to sink the package Monday — including CBC Chairwoman Carolyn Cheeks Kilpatrick (D-Mich.) — despite efforts by leaders to turn some of them on the floor before they gaveled the vote closed.

Several African-American lawmakers opposing the bill said they were coalescing around a plan drafted by Rep. David Scott (D-Ga.) to add a $14 billion carve-out in the bailout to aid homeowners struggling with mortgage costs. “We should be moving with an urgency to keep folks in their homes,” Scott said. “Otherwise, it’s like putting a pail there to catch the water, and there’s a hole in the bottom of the pail. … This has to be on two tracks — we can’t just throw money to the top.”

Rep. Jesse Jackson Jr. (D-Ill.), for example, needs Scott’s plan, or one like it, included in the rescue package before he can support it, a spokesman said. Jackson has been targeted by Democratic leaders, with Speaker Nancy Pelosi (Calif.) lobbying him on the floor Monday and Democratic presidential nominee Sen. Barack Obama (Ill.) calling him Wednesday.

But Scott’s proposal is not in the Senate package, and adding it on the House side would mean having to send it back to the Senate — something Democratic leaders hope to avoid.

A House Democratic aide, meanwhile, said that they hoped to shore up some of those Democrats because the Senate bill included a House provision to help struggling homeowners — an extension of a $1,000 tax credit for property owners who do not itemize that was not originally in the Senate proposal.

Obama spokesman Nick Shapiro confirmed the candidate was making calls to House Democrats on Wednesday, though he declined to name them or even say how many calls the Illinois Senator placed. A McCain campaign spokesman did not respond to a request for comment.

House Minority Whip Roy Blunt (Mo.) also has been working round-the-clock with other GOP leaders and administration officials including White House Chief of Staff Josh Bolten to scrounge up additional votes.

One thing appears clear — Hoyer and Blunt have no intention of going to the floor without making sure they have the votes.

“What happened Monday can’t happen again,” said Antonia Ferrier, spokeswoman for Blunt.

Hoyer said he has been in several meetings with Blunt but doesn’t know how many Republicans are yet on board. Hoyer, however, said the Republicans should be able to deliver 100 votes.

“I think many are going to find it … to their liking,” Hoyer said.

On another front, Hoyer said economic stimulus legislation is unlikely to move because of opposition from Senate Republicans, a reality that is “unfortunate.”

A House Democratic leadership aide said that prospects seemed to be improving for the deal and was hopeful a few extra Democrats might vote for it.

But they will want ironclad confirmation this time that Republicans have the votes before going to the floor.

“It’s trust, but verify, verify, verify,” a House Democratic leadership aide said.

Jennifer Bendery contributed to this report.