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House REJECTS bailout plan!

edited December 2010 in Other Stuff

http://www.msnbc.msn.com/id/26884523?GT1=43001

WASHINGTON – The House of Representatives rejected a $700 billion bailout today following extended debate where many members, including some who brokered the deal with it, was highly unpopular.

The preliminary vote was 185-197. Members had a limited amount of time to change their votes. Following the deadline, the margin was growing for those opposed to the measure.

Even as the electronic roll call began, Democratic and Republican leaders were uncertain about having enough votes to pass the politically unpopular plan. It’s the most sweeping government intervention in markets since the Great Depression.

The bailout puts in place an unprecedented federal program to buy up rotten assets from cash-starved firms. The goal is to free up choked credit that was threatening to cause broader market turmoil.

“Many of us feel that the national interest requires us to do something which is, in many ways, unpopular,” said Rep. Barney Frank, the Financial Services Committee chairman, before the vote. “It is hard to get political credit for avoiding something that has not yet happened.”

The bill was the product of marathon bargaining over the weekend among various House and Senate representatives.

President Bush urged the bill’s passage, saying in a White House appearance Monday morning that “every member of Congress and every American should keep in mind that a vote for this bill is a vote to prevent economic damage to you and your community.”

“With this strong and decisive legislation,” he said, “we will help restart the flow of credit so American families can meet their daily needs and American businesses can make purchases, ship goods and meet their payrolls.”

As debate opened, Frank, D-Mass., called the measure “a tough vote,” but a necessary one to stave off a financial meltdown. It lets the government buy sour assets  mostly mortgage-backed securities  from struggling financial institutions in a bid to clear out clogged avenues of credit for businesses and individuals alike.

At the White House, spokesman Tony Fratto confirmed vigorous efforts to get the bill through.

“We’re going to keep working with them right up until the vote,” he said.

Fratto also said that Bush, Vice President Dick Cheney, Treasury Secretary Paulson, White House chief of staff Josh Bolten and other top officials were contacting House members in an effort to rally support, and that the president himself had call list of “a couple dozen members.”... (continued on website)

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Comments

  • Sorry, its in danger of being rejected as they didnt have enough votes, so they are trying to give them more time to change their minds.

  • If this gets passed, we’re screwed. Keep your fingers crossed.

  • It is now officially rejected I believe.

    Winona. Basically the jist of it is is that we are in a economic slump because of rash decisions made by very rich companies. I dont know if you remember but about a year ago everyone, bad credit or not, was somehow able to apply for home loans and get them. It then turned out most of these people could afford the payments, so a lot of the loans went into default and caused many of the major banks to lose a lot of money they had loaned out.

    Because of this, and other smaller reasons, numerous banks started going under. Wall street, during the time of the loans, was doing well. Now its falling drastically as banks come out everyday saying they cant keep in business.

    Banks run all major financial institutions in America. All business’s require banks. Wall Street, through risky gambling on stocks tried to keep the banks afloat, but only turned it around on themselves.

    The lower our dollar goes, the less we can buy from other countries, which can grind trade, such as with oil and foods to a hault.

    So the government devised a plan that would take OUR tax money and future tax money to bail out these institutions so our dollar can once again increase and we can become a dominant force once again in the world of economics to the tune of 700 billions dollars. That money would be taken from US.

    WIthout the bailout, many business’s need to and will cut jobs to stay afloat, food prices can go higher, as well as everything else. So in a sense, its a bad thing that it didnt go through.

    But in my personal opinion, its time for America’s empire and its way of always thinking it can outbuy the world too fall. I cant say exactly what will happen now that the bailout failed, or whether or not they will be able to bring a new one to the table soon, but imagine the great depression in 2010ish.

  • I’ve been watching this too. Just can’t believe all these ‘smart bankers” could not see this coming. What a mess! On one hand, if it were to pass, I could get the loan that I am applying for a to buy a business. On the other hand I think it is absultelu outrageous that we pay for the stupidity of the few.

  • I got this in an email chain, I thought share it with you guys;

    “The American Taxpayer Economic Recovery Plan

    Hi all, I'm against the $85,000,000,000.00 bailout of AIG.

    Instead, I’m in favor of giving $85,000,000,000 to America in a

    We Deserve It Dividend.

    To make the math simple, let’s assume there are 200,000,000

    U.S.Citizens 18+. Our population is about 301,000,000 /- counting every man, woman and child. So 200,000,000 might be a fair stab at adults 18 and up..So divide 200 million adults 18 into $85 billon. That equals $425,000.00.

    My plan is to give $425,000 to every person 18+ as a We Deserve It Dividend.

    Of course, it would NOT be tax free. So let’s assume a tax rate of 30%.

    Every individual 18+ has to pay $127,500.00 in taxes.

    That sends $25,500,000,000 right back to Uncle Sam.

    But it means that every adult 18+ has $297,500.00 in their pocket.

    A husband and wife have $595,000.00.

    What would you do with $297,500.00 to $595,000.00 in your family?

    Pay off your mortgage, housing crisis solved.

    Repay college loans, what a great boost to new grads.

    Put away money for college, it’ll be there.

    Save in a bank, create money to loan to entrepreneurs.

    Buy a new car, create jobs.

    Invest in the market, capital drives growth.

    Pay for your parent’s medical insurance, health care improves.

    Remember this is for every adult U S Citizen 18+.

    Including the folks who lost their jobs at Lehman Brothers and every other company that is cutting back.

    And of course, those serving in our Armed Forces.

    If we’re going to re-distribute wealth let’s really do it..

    .instead of trickling out a puny $1000.00 economic incentive that is being proposed by one of our candidates for President.

    If we’re going to do an $85 billion bailout, let’s bail out every adult U S Citizen 18+!

    As for AIG, liquidate it. Sell off its parts.

    Let American General go back to being American General.

    Sell off the real estate.

    Let the private sector bargain hunters cut it up and clean it up.

    Here’s my rationale. We deserve it and AIG doesn’t.

    Sure it’s a crazy idea that will never happen.

    But can you imagine the Coast-To-Coast Block Party!

    How do you spell Economic Boom?

    I trust my fellow adult Americans know how to use the $85 Billion.

    And remember, The American Taxpayer plan only

    really costs $59.5 Billion because $25.5 Billion is returned instantly in taxes to Uncle Sam.

    Ahhh….I feel so much better getting that off my chest

    PS: Feel free to pass this along to your pals as it's either good for a laugh or a tear or a very sobering thought on how to best use $85 Billion!!,"
  • A few of my favorite congressmen/women speaking out against the bailout:

    Dennis Kucinich: http://www.youtube.com/watch?v=lJ2gnXu7ezA

    Marcy Kaptur: http://www.youtube.com/watch?v=oAADyc6t4nY

    Ron Paul: http://www.youtube.com/watch?v=YBVB1Uc0nko

  • The following is from www.campaignforliberty.com

    Inside baseball on the bailout

    September 29th, 2008 by Jesse Benton

    I just spoke with a senior legislative aid on the Hill and was told that the bailout is definitely dead for today and Tuesday in light of the the Jewish Holiday.

    Pro-bailout negotiators will begin reaching out to Reps who voted Nay to tweak the deal and change their minds. A vote to reconsider is possible for Wednesday, but more likely for Thursday or Friday. It is a major blow to both Nancy Pelosi and the Administration that the Taxpayers prevailed in round one. Expect arm-twisting of epic proportions in round two.

  • Thanks Kevlar for posting the links. They are so right!

  • Here is a vote tally. A list of AYES and NAYS.

    http://www.campaignforliberty.com/blog/?p=647#m…

    Note – The republicians are in italics.

  • jkd – I really appreciate the summary you gave. I have been reading the news and even the economist magazine, but it was still hard to understand how the system worked.

    I had certainly heard about the loan frenzy – they were being handed out like candy, to folks who should not have qualified for loans. Also, don’t forget – there were folks who evaluated houses at higher prices than they actually were worth, and banks gave loans for the higher amounts. Also, banks can loan much more money than they have, etc. We’re paying for the idiocy of a few because the current administration allowed for the deregulation of these banks!!

    What i’m wondering is – how serious is it? How bad is the economy going to get?

  • I’m soooooo glad this got rejected. It’s the most ridiculous thing I’ve heard of. Why give these banks and corporations another chance to screw things up? I think it’s important for our country to go through an economic crisis simply to learn how to deal with money and credit. We can’t keep going on like this. People need to learn how to live more simply and with less excess. Learn to garden, drive less and don’t buy a house if you know you can’t make the payments! It’s as simple as that.

  • I have mixed feelings about this. On one hand I see the economy going to the craper and it gets as bad is it seems it might I WILL likely loose my job. Something has to be done. The only way we got out of the Great Depression was through government intervention. It seems it’s that time again.

    But at the same time I don’t like the idea of helping out this large banks. I did the math though and by dividing that 700 billion dollars by 300 million Americans, every person could have $2,300!! Now take that further and only hand out money to tax payers and that number will go up.

    On another note I was recently denied a car loan (only $4,500 at that) and I have very good credit and own a home. That kind of goes to show just how bad things are right now. I am definitely worried, but at the same time I won’t loose sleep over it just yet.

    edit: ikin, didn’t see your saying more extensively what I just said :)

  • It’s funny, Caleb, I didn’t think about this before since we bought our car right before the gas prices when haywire this summer but we weren’t given as good a rate as we had hoped and we have good credit and own a house. I was surprised then but now it makes sense.

    I agree, I’m just glad we aren’t giving our money to big bank that made bad choices. Who’s to say they won’t again?

  • Caleb, I got this in an email thread. But I just relized their math is off. Oh, well, doesn’t really matter, becuase it wouldn’t happen anyway.

    You’re right. It is a very complex situation. I have mixed feelings too, but I do feel that a bailout is not the answer.

  • Exactly Trouble! If they can continue their bad practices without any consequneces, than the 700 bil will go down the drain and we will find ourselves in deeper trouble.

  • Caleb, the government’s interference is what got us into the great depression in the first place. The Federal Reserve was created in 1913, and 16 years later, in 1929, we had the stock market crash. Sure, we had recessions before that, but nothing of that scale.

    A free market kept the country going strong from 1776 all the way up to 1913.

  • If you don’t know this show, you should. It’s so entertaining. “This American Life” shed some awesome insight as to what really happened

    http://www.thisamericanlife.org/Radio_Episode.a…

    I no longer wonder “how” this could go down. It’s the second part of the show, about 30 minutes in. Just click the full episode button. I found it worth the listen. BTW I heard every taxpayer will be paying $7000, per someone’s link to wanda sykes on leno…

  • My boss is a silver trader on the market, and watches the news and stock constantly while at work.

    I asked him about it:

    He told me that the house will “bang” out an agreement and get one passed, but it will only work short term. The problems they are trying to solve is in the TRILLIONS of dollars, and in the long runthey will keep having more and more bailouts.

    If that happens, the dollar crashes. If the dollar crashes it crashes WORLD stocks everywhere. There isnt really any exact answer to your question on what will happen, but the economy will get BAD. Im talking the world over. Everything America does affects three fold throughout the world.

    From what I read, when people talk about the economy failing and the dollar crashing nowadays, is: “we are treading on unkown waters.” Basically meaning most wont know what will happen!

  • sigh This sucks. It sounds like lots of folks are going to lose their jobs, and there’s nothing we can do to stop it. grr.

  • yeah it does suck alot. I’m hoping my job is alright. But if it isn’t I know that I’ll survive. It’s an extremely tough situation but it needs to happen. It’s common sense to be wise with money and if our country as a whole isn’t wise they need to learn how and it seems to me they won’t learn unless this happens. When I say country I mean the big corporations as well as citizens.

  • Ok so here in the greater Atlanta area, there is not only no money after today, there’s no gas…there’s no water. On top of that, people still are not conserving! Children’s practices across town still go on with full penalties if they don’t attend. C’mon Atlanta-it’s Jr. High Cheerleading!!!!!! I’m confident the world would go on without cheerleading, yes? I try to think how prepared I might be for the day the tank runs dry, the water becomes too toxic to drink (but they’ll pronounce it fit for drinking anyway-just add some more chlorine! No wonder everyone’s blonde here!) and my credit card no longer works. Hmmm..I can ride my bike to the bank, to food, and to work. On the plus side, my flowers look darn good from a summer of grey water! Way off topic :).

  • ^ Yeah, don’t forget to get prepared to survive without food, water or electricity.

  • In my lifetime, I have not ever seen any good come from things being rushed and/or based on fear.

    Is it going to get bad…I really do not think it is going to be as bad as the fear they are trying to pump into the American public right now.

    The Credit Industry will freeze or I should I say has frozen. But I believe it is time to stop the consuming madness.

    Here are some links to what economists experts are saying….(note – mainstream media are not experts!!!)

    http://leisureguy.wordpress.com/2008/09/27/fina…

    Here is a quote from a quote from the above link….

    former top IMF and Federal Rerserve official Ken Rogoff (now a top economist at Harvard) saying the liquidity crisis is a creation – an illusion of a crisis actually CAUSED by the prospect of a $700 billion bailout proposal, rather than a bailout proposal being proposed in response to a natural emergency.

    “Ken said that his many friends in investment banking said that there is plenty of money to invest in financial services, but right now it is “sitting on the sidelines.†Why? Because the financial services industry does not want to pay the terms demanded. As he put it, why do business with Warren Buffett who will negotiate a tough deal, if you believe that the government will ride in soon with cheaper cash?”

    Do We Even Need a Bailout?

    http://leisureguy.wordpress.com/2008/09/26/do-w…

    Here is an interesting read of economist online....

    http://economistonline.blogspot.com/2008/09/har…

    In my opinion, in a strange way, you could possibly look at the outcome of this bill as a reflection of what we could possibly see in the upcoming 2008 Election. The fact that people are tired of the “BS”!

    I could be wrong, but just a thought.

    Something to think about….you might want to stock up on some water, just in case there is a mad frenzy. Fill the bathtub with water to use to flush the toilet.

  • simplyraw-I agree, we shouldn’t be driven by fear and we HAVE GOT to stop the consuming and addiction to excess and possessions. It’s ridiculous.

    Although it’s a great idea to be prepared.

  • We use grey water to flush when necessary. This family of 5 produces a lot of grey water! Last year, I did stockpile water. This year, though, I don’t want to buy all that plastic. When you think about foods with a long shelf-life, raw food doesn’t pop to mind.I’m not prepared for any of it, even though Living Without is knocking at my door.

  • Haha. Simplyraw! I love the very end ;) I have about appx 60 days worth of drinking water saved if I dont decide to clean myself, and about 30 days saved for a single human so far if I decide to keep myself undirty if TSHTF.

    Although I dont think we are in the midst of people rushing to grocery stores for canned goods and water yet, I think its coming up soon. We touched on this in another topic ;)

  • lzhpt – I’m managing to successfully stockpile raw food. It’s mainly garbanzo beans, lentils, mung beans, buckwheat, sunflower seeds, and other seeds to sprout, along with lots of dried fruit, olive oil, sea salt, honey, and apple cider vinegar.

    I’m going to use it all too, and replenish it as I go, so none of it will go bad.

    I’m not panicking or anything, and none of us should do that. I’m just gradually and calmly collecting supplies.

  • Here’s an update from the Campaign for Liberty: http://www.youtube.com/watch?v=lFh6PU6qM9Q

  • Interesting…Let’s no blame it all on the “smart” bankers. This endless and VERY expensive war has contributed to lead this country to this bad financial situation. What is first is first. Let’s stop the war and save millions, billions perhaps; that would certainly not help the banks, but will help us all

  • Do you believe today’s Congressional vote against the Wall Street bailout is a victory for the American people and a rejection of the attempted extortion by corporate and political elites?

    If interested…go to http://loudobbs.tv.cnn.com/ to vote.

    Pan down page to QuickVote on right side of page.

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