The plan – now loaded with a number of sweeteners that helped it pass easily in the Senate – would allow the U.S. government to spend billions of dollars to buy high-risk mortgage-related securities and other devalued assets from troubled financial institutions.
Advocates say if it works it will allow frozen credit to begin flowing again and prevent a serious recession.
The much-anticipated do-over comes after the plan met with a stunning defeat Monday, triggering a historic stock market plunge.
It was still unclear, though, whether leaders would have the dozen or so supporters needed to pass the measure.
One thing was unmistakable: the U.S. economy is in trouble. The Labour Department reported Friday that employers slashed payrolls by 159,000 in September, the most in more than five years.
The figures also show that many more people left the labour force for any number of reasons.
The White House suggested that the figures were more convincing evidence of the need for the bailout. “The best action we can take to limit damage to the economy is to pass the emergency rescue package legislation in the House,” said spokesman Tony Fratto.
… Republicans and Democrats alike said appeals from credit-starved small businessmen and the Senate’s addition of $110 billion in tax breaks and other sweeteners had persuaded them to drop their opposition.
“I hate it,” but “inaction to me is a greater danger to our country than this bill,” said Representative Zach Wamp, a Tennessee Republican.
via Canadian Business Online: Cong. Leaders Optimistic as House Gears up for 2nd Vote on Bailout Plan