Carolinas lawmakers pledged to return with a stronger bill after a massive government bailout of the nation's banking system failed Monday to win enough support from either political party to pass the House.
“We need to go back to the drawing board and come up with other solutions,” said Rep. Sue Myrick, a Charlotte Republican. “This is not a Democrat-Republican thing. It's a genuine American concern, and that's encouraging in this Congress in a strange way. We'll come back to the table, and we'll do something that will take care of the problem.”
All N.C. Republicans opposed the bill, which was crafted by a bipartisan group of negotiators but failed in the House by a vote of 228-205. The delegation's Democrats were split, with Reps. Heath Shuler of Waynesville, G.K. Butterfield of Wilson, and Mike McIntyre of Lumberton voting against it.
“Unfortunately, the rush to respond has resulted in a plan that is too risky and gives away too much without any guarantees that the problems will be corrected,” Butterfield said. “While people talk about stabilizing the markets, we should be focused on stabilizing families and our rural communities.”
The vote was particularly stunning on a day when a home-state bank, Charlotte-based Wachovia, which had been plagued by bad mortgage debt, was acquired by Citigroup.
Some lawmakers said they agonized over how to vote on the legislation, which was Congress' answer to a Wall Street rescue plan submitted by the White House more than a week ago.
“No one comes to the well of this House today with any relish or enthusiasm,” said Rep. John Spratt, a York County, S.C., Democrat.
Spratt, who voted for the bailout, said the eventual cost of the bill would be “substantially smaller” than the $700 billion price tag it initially carried because some of the troubled assets purchased in the bailout would likely recover their value over time. He listed a number of other ways that the bill had been improved – including a requirement for more oversight of the bailout program and limits on executive compensation.
All S.C. members of the House voted in favor of the bailout, except Rep. J. Gresham Barrett, a Republican of Westminster, near Greenville.
Though 95 of the 235 Democrats in the House opposed the bill, ultimately it failed because the Bush administration was only able to persuade a third of House Republicans to buy into it.
Rep. Robin Hayes, a Concord Republican, said he opposed it because foreign banks and financial companies would have been just as eligible to receive U.S. taxpayer assistance as American companies.
Cherryville Republican Patrick McHenry said: “It would be big, expensive and ineffective.” Rep. Mel Watt, a Democrat from Charlotte, said while the White House hadn't been able to convince the American public that drastic measures were needed, he believed the intervention was necessary.
“It would be politically irresponsible and substantively irresponsible to not do what people sent me here to do, which is cast responsible votes,” he said. “You can't always stick your finger up in the air.”
The House vote got mixed reviews from the Senate on Monday.
Sen. Elizabeth Dole, R-N.C., urged the Bush administration to “develop a market-based solution that doesn't put a massive burden on the shoulders of the taxpayers.”
Sen. Jim DeMint, R-S.C., one of the leading bailout opponents, said the White House and Congress had been given a bad choice between “do nothing or pass this bailout.”
“Americans have said ‘no' to both and demanded that we take a third way and do the right thing to grow our economy and reform our government,” DeMint said.
However, Sen. Lindsey Graham, R-S.C., said he hoped Congress would spend the next few days reworking the bill.
“If we do not address this issue, our nation may be headed toward a major financial collapse,” Graham said. “For the common good, we must find a solution to this problem. Without the ability to borrow money to build a business, buy a home, or go to school, our country will be brought to its financial knees.”