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Politics & Government

Bailout vote an extraordinary risk for members of Congress

David Lightman - McClatchy Newspapers

September 28, 2008 04:46 PM

WASHINGTON — The vote this week in Congress on the massive financial rescue package will be as risky as pre-election votes get. Five weeks before an election, there's no easy way to know what's politically correct. And though the package is expected to eventually pass, no one can predict whether the margin of approval will be overwhelming or skin-tight.

"Everyone knows something has to be done, but they don't want to take the hit if everything blows up," said Dennis Goldford, professor of politics at Drake University in Des Moines, Iowa.

Lawmakers from both parties this weekend said their e-mail and phone calls have overwhelmingly conveyed the same message: Don't do anything that even hints of a bailout for Wall Street executives.

The deal reached on Capitol Hill Sunday would seem to address a lot of those concerns, notably by subjecting half the $700 billion to congressional action, and limiting pay for executives at troubled firms.

But here's the dilemma for members who vote for the bill: Will voters back home be convinced this is the best approach, and one crucial to stabilizing the markets? What if the unexpected happens and the financial world takes another dive in late October? What if layoffs rise and the markets plunge a few days before the election?

"This vote is like asking a patient if he needs...chemotherapy. No one really wants to give it to him, but they suspect the patient will die if he doesn't get it," Goldford said.

Chances are neither presidential candidate will be affected. Republican John McCain has taken credit for helping broker a deal — even though he never sat in on congressional negotiations and is not a member of the Banking Committee.

Barack Obama issued a statement of principles last week, and declared victory Sunday. He praised the tougher supervision of the rescue plan, aid to homeowners faced with foreclosure and the executive pay limits.

"They are identical to the things I called for the day (Treasury Secretary Henry Paulson) released his package," Obama said. "That I think is an indication of the degree to which when it comes to protecting taxpayers, I was pushing very hard and involved in shaping those provisions."

But Democratic staffers familiar with the congressional talks say that neither Obama nor his staff had any significant involvement in shaping the package, and that several Democrats as well as some Republicans championed the items he praised.

"I think voters will realize the candidates were peripheral to the process," Goldford said.

The bigger political risk involves members of Congress — the 435 House and 34 Senate seats up Nov. 4.

While a sizeable number of Senate Republicans are expected to vote for the package, Democratic House leaders have indicated they want at least 100 GOP House votes, about half the GOP membership.

It's a number that GOP leaders are suggesting is possible and perhaps likely. Strong GOP support will allow both parties to claim the package if bipartisan, and give everyone cover in case things go haywire in October.

Still, a lot of House Republicans have been ready to say, "I told you so" if that happens.

"I don't think the American people should have a financial gun put to their head," said Ted Poe, R-Texas. "If a mom and pop makes a bad financial decision, they go out of business."

"Every American who has played it safe and smart to avoid debt is being asked to spend the rest of his or her life paying off the debts of Washington and Wall Street," added Rep. Michele Bachmann, R-Minn.

Bill supporters have been fretting they aren't being given enough time to thoroughly examine the complex package, and Rep. Eric Cantor, R-Va., a member of the Republican leadership team and the renegade GOP members, warned Sunday, "We are not ready to say a deal is done."

Supporters are pushing for a House vote by Monday afternoon. If that does not happen, no votes are likely to at least Wednesday because of the Jewish New Year.

Skeptics warn that a rush to judgment will be financially as well as politically harmful.

"The irresponsible desire to meet a deadline solely for the sake of meeting a deadline will produce an agreement that does not protect taxpayers from this bailout," said Rep. Thaddeus McCotter, R-Mich., chairman of the Republican House Policy Committee.

Backers know they are taking a political gamble that stabilizing markets and providing some economic calm will cool such talk. And they were buoyed Sunday by a new USA Today-Gallup poll, taken Sept. 24, showing 74 percent of those surveyed thought economic conditions would "get worse" unless Congress acts.

But they also know that there are no guarantees, and with just a few weeks before an election, probably no second chance to do this over.

Or as McCain put it Sunday, "This is something all of us will swallow hard and go forward with."

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