On Wednesday October 1st, 2008, the U.S. Senate passed the latest version of the "bailout" bill by a 74-25 vote. Breakdown by party: 39 Democrats, 34 Republicans and independent Sen. Joe Lieberman of Connecticut voted Yes, while 9 Democrats, 15 Republicans and independent Sen. Bernie Sanders of Vermont voted No. Utah Senators Bob Bennett and Orrin Hatch voted Yes. A complete roll call can be viewed HERE.
Utah media stories published by the Deseret News, the Salt Lake Tribune, and KSL Channel 5 (with 606 public comments so far).
Loaded up with $100 billion in new perks to make it more digestible to fractious lawmakers, the bill, officially designated the "Emergency Economic Stabilization Act Of 2008", has grown from 110 pages to 450 pages. Some of the additions, ferreted out by Gather.com, are pure pork. However, according to CNNMoney, there are a number of significant additions:
- Temporarily raises the FDIC insurance cap to $250,000 from $100,000; FDIC may not charge member banks more to cover the increase in coverage.
- Allows the FDIC to borrow from the Treasury to cover any losses that might occur as a result of the higher insurance limit.
- Extends a number of renewable energy tax breaks for individuals and businesses, including a deduction for the purchase of solar panels.
- Renews the research and development credit for businesses and the credit that allows individuals to deduct state and local sales taxes on their federal returns.
- Provides another year of relief from the Alternative Minimum Tax, without which millions of Americans would have to pay the so-called "income tax for the wealthy."
The Salt Lake Tribune and KTVX Channel 4 reported that Senator Orrin Hatch was at first reluctant to support the plan to buy up toxic mortgage-related debt from struggling banks. But with the credit markets seizing up and the stock market falling, he said Congress had little choice but to support the bailout.
Senator Bob Bennett, a senior member of the banking committee, has been one of the bailout's biggest supporters. He said it was good medicine for an ailing economy, but warned it is not a cure-all. He still believes we are headed for a recession, but he thinks the bill will result in a milder recession.
On Friday October 3rd, the bill goes to the House. Rep. Chris Cannon, who voted for the first bill, is likely to vote for this version. Rep. Bob Bishop, who voted against the first bill, is softening his opposition. Bishop liked the additions to the bill, especially the money for rural Western counties and tax breaks for renewable energy, but he had not yet decided if it was enough to change his vote. As for Rep. Jim Matheson, his office did not say if the additions had any impact on his position on the bill. Update October 2nd: KSL now reports that Matheson will vote against the revised bill as presently written. His objection: pork.
All members of the Utah delegation report that consituent feedback, which initially was overwhelmingly against the bailout, is slowly shifting. Monday's mega-drop in the stock market seems to have sobered some people up.
A new story posted by Time explains why "Main Street" is mad. Opponents of the bailout tend to group into two categories. Unconditional opponents think any bailout is an outrage at a time when CEOs have been getting such huge bonuses. These people are so outraged that they don't get past that issue. Conditional opponents do reluctantly concede that some intervention is necessary to avert financial calamity, but are outraged that Congress would pass any bill that is so inequitable to Main Street. The latter group now appears to be larger. People in both groups also question why it is so urgent to pass legislation immediately; they are suspicious of Henry Paulson's sense of urgency. They want a thorough debate.
And I hope the House does not allow itself to be stampeded on Friday. It is better to hold out for a good bill, regardless of the risks, than rush a bad bill through.