Senate to Vote on bailout Wednesday night

Senate to Vote on bailout Wednesday night

WASHINGTON - President Bush's plan to rescue U.S. financial markets is headed for a Senate vote Wednesday night after leaders there agreed to add tax breaks for businesses and the middle class and increase deposit insurance in an attempt to revive the legislation rejected by the House.

The surprise move by Majority Leader Harry Reid, D-Nev., and Minority Leader Mitch McConnell, R-Ky., appeared likely to win a big vote in the Senate that would put pressure on the House to go along and send the measure to the White House.

Democratic presidential nominee Barack Obama and his GOP rival, John McCain, planned to fly to Washington for the Senate vote, as did Democratic vice presidential nominee Joe Biden.

(visit the link for the full news article)



Related AboveTopSecret.com Discussion Threads:
Congressional bailout fails

The house couldn't pass the bailout, so now they want to call it a "recovery." It will still cost us (the taxpayers) more than we can afford. Two congressmen, one of them being Marcy Kaptur (D-Ohio), was on Lou Dobbs last night. She and her colleague were promoting a plan similar to the one that was used during the S&L crisis of the 80's. Their plan won't cost anything, and if it works great. If not, it buys us some time to come up with something, and have public hearings so the voters are informed about what is going on. (Is anyone besides me concerned that ALL the negotiation on this was done behind closed doors?)
Madam Congresswoman Kaptur is also in favor of investigation and possible prosecution of those involved in these scams that precipitated this crisis. (They need to go after Chris Dodd and Barney Frank.)
Call the Capital switchboard, email, or fax your Senators and let them know where you stand on this.


(visit the link for the full news article)

If I'm not mistaken a money bill can't originate in the Senate, has to come from the House. So they are getting around this by attaching it to a bill already on the agenda. I'm also under the impression that many foreign leaders want this to pass(Germany, Britain, Japan, and Australia), and that when you get down to it, this bill is for foreign banks.

[edit on 1-10-2008 by StephenF]

I only posted that the Senate was going to vote. Below is a plan that we should send to every one of our Senators and Representatives. It is not mine. It was written by Dave Ramsey, who is a financial guru who teaches people how to stay out of debt. I received this morning, and it sounds like a plan to me. It won't cost anything, and it might work. (Don't much care what the foreign banks want. I'm worried about the taxpayers in this country. Let them keep their noses out of our business.) I hope everyone will cut and paste Mr Ramsey's idea and forward it to their representatives and senators today.

Years of bad decisions and stupid mistakes have created an economic nightmare in this country, but $700 billion in new debt is not the answer. As a tax-paying American citizen, I will not support any congressperson who votes to implement such a policy. Instead, I submit the following three steps:

Common Sense Plan.

I. INSURANCE

A. Insure the subprime bonds/mortgages with an underlying FHA-type insurance. Government-insured and backed loans would have an instant market all over the world, creating immediate and needed liquidity.

B. In order for a company to accept the government-backed insurance, they must do two things:

1. Rewrite any mortgage that is more than three months delinquent to a 6% fixed-rate mortgage.
a. Roll all back payments with no late fees or legal costs into the balance. This brings homeowners current and allows them a chance to keep their homes.
b. Cancel all prepayment penalties to encourage refinancing or the sale of the property to pay off the bad loan. In the event of foreclosure or short sale, the borrower will not be held liable for any deficit balance. FHA does this now, and that encourages mortgage companies to go the extra mile while
working with the borrower—again limiting foreclosures and ruined lives.

2. Cancel ALL golden parachutes of EXISTING and FUTURE CEOs and executive team members as long as the company holds these government-insured bonds/mortgages. This keeps underperforming executives from being paid when they don’t do their jobs.

C. This backstop will cost less than $50 billion—a small fraction of the current proposal.




II. MARK TO MARKET

A. Remove mark to market accounting rules for two years on only subprime Tier III bonds/mortgages. This keeps companies from being forced to artificially mark down bonds/mortgages below the value of the underlying mortgages and real estate.

B. This move creates patience in the market and has an immediate stabilizing effect on failing and ailing banks—and it costs the taxpayer nothing.




III. CAPITAL GAINS TAX

A. Remove the capital gains tax completely. Investors will flood the real estate and stock market in search of tax-free profits, creating tremendous—and immediate—liquidity in the markets. Again, this costs the taxpayer nothing.

B. This move will be seen as a lightning rod politically because many will say it is helping the rich. The truth is the rich will benefit, but it will be their money that stimulates the economy. This will enable all Americans to have more stable jobs and retirement investments that go up instead of down. This is not a time for envy, and it’s not a time for politics. It’s time for all of us, as Americans, to
stand up, speak out, and fix this mess.
is going to vote on the "bailout" tonight.