Rep. Sue Myrick wouldn't support a $700 billion bailout after hearing pleas from the White House and the nation's top financial regulators that it was necessary to avoid economic disaster.
But when she got home to Charlotte this week and heard it from the bottom up – reality set in. Local officials, small business owners and big companies including Lowe's persuaded Myrick to change her vote.
“They're not having any problems with their bottom line, their business is good, but they cannot get credit,” Myrick said Friday of some of the business people she's known for decades.
“There is a credit crisis, I believe that,” she said. “I think we are in a very, quite frankly, dangerous place relative to the financial situation in the country.”
Myrick and nearly 60 other lawmakers switched their position Friday and voted for the sweeping legislation designed to allow the government to buy troubled assets from financial institutions so they can free up more money to make loans.
Facing growing anxiety about the economy and fears of, as Myrick put it, “a complete catastrophic credit meltdown,” Congress approved the bill Friday in a 263-171 vote.
Another N.C. Republican, Rep. Howard Coble of Greensboro, not wanting to take the risk that the economy really was about to collapse, joined her in the switch.
Coble said the bill had been improved with an increase to $250,000, from $100,000, in the amount of federally insured deposits and with other tax breaks for consumers.
“I don't believe the sky is falling,” Coble said, announcing on the House floor he would vote for the bill. “It may be politically damaging and the sky may fall tomorrow, but it will fall upon my head, it won't fall upon anybody else's and no one else will be adversely affected.
“The limited access to credit, and in many instances, no access to credit can certainly contribute to a crisis. We can put on the blinders and go one way or the other, but this is a bill that must be addressed today.”
The House rejected the Bush administration's rescue plan on Monday, and the Senate revised the plan by tacking on tax breaks, disaster aide and a mental health parity bill. Among the “sweeteners” added to attract more support was a tax break for NASCAR and other motorsports facilities that allowed them to continue to depreciate their capital investments over a seven-year period instead of 15 years.
The new provisions infuriated folks like Jason Goodfriend, a business analyst from Matthews, who didn't think the bailout bill was an appropriate place for pet projects.
“I just think it's preposterous that they would do this at this moment when we have such an important crisis to fix and they know people are so sick of these pork projects,” Goodfriend said.
The bill, passed overwhelmingly Wednesday by the Senate, has been signed by the president.