Bailout not dead yet
By RYAN GRIM & MARTIN KADY II | 9/30/08 8:37 PM EDT
The bailout is back.
Senate leaders have decided to take up the failed House version of the $700 billion economic rescue bill, and plan to add a widely supported change in the Federal Deposit Insurance Corp. caps.
In what is shaping up to be yet another historic vote, presidential candidates Barack Obama and John McCain will return to Washington for a late Wednesday night vote.
But unlike the tumultuous House vote, the Senate roll call is expected to go more smoothly. While nothing is a slam dunk at this point, there is an expectation on both sides of the aisle that the bailout could receive 60 votes in the Senate, enough to overcome any potential filibuster.
The decision to hold this vote Wednesday in the Senate comes after Minority Leader Mitch McConnell (R-Ky.) spent much of the day pressuring the Senate Democrats to put the bill on the schedule. Late Tuesday, Majority Leader Harry Reid (D-Nev.) relented and agreed to schedule the vote after sundown on Wednesday, when Rosh Hashana ends.
“The voters sent us here to respond to crises, not to ignore them," McConnell said. "And if you fail the first time, you get back up, and you work with each other.”
Sen. Charles Schumer (D-N.Y.), embraced the idea as well, but sought to give Reid credit for attaching the FDIC measure and a widely popular tax extenders bill to the bailout.
“This is a brilliant move by Harry, and I believe it will help pick up votes on both sides of the aisle.”
The Senate vote is designed to not only send the right message to the financial markets, but also to ratchet up pressure on the House, which killed the bill 228-205 on Monday afternoon.
The proposal will be taken up along with a renewable energy tax credit extension. Aides say the bill will include an increase in the amount of deposits insured by the FDIC from $100,000 to $250,000 —measure backed by both the presidential candidates.
The chamber will also vote on a millionaires' surtax proposed by Sen. Bernie Sanders, a Vermont independent who caucuses with Democrats.
Technically, all revenue raising bills are supposed to originate in the House, but the Senate will use the tax extenders bill as the legislative vehicle for the $700 billion economic rescue plan.
So far, even the most staunch Senate conservatives have not threatened a filibuster in the Senate. Even if the bill clears the Senate by a comfortable margin, though, it's not clear where House leaders will find enough vote switchers to win passage in that chamber.
There is one looming political problem with Democrats in the House now that the energy tax incentives will be attached _ the legislation is not paid for with any revenue increase, and that may cause trouble with the staunch balanced budget crowd of "Blue Dog" Democrats.
A House Dem leadership aide said the Blue Dogs were "furious" over Reid's maneuver, which is designed to draw GOP support.