U.S. lawmakers - preparing for a vote Monday - have made public draft legislation that would pay for the government to buy up to $700 billion in bad debt from private financial companies. The draft of the bill was circulated Sunday to allow members of the House of Representatives to review it before voting on it Monday, with a Senate vote most likely later in the week. Congressional leaders and Treasury Secretary Henry Paulson said they wanted to make the draft of the bill public before Asian markets open Monday. President Bush issued a statement late Sunday praising the leadership of both political parties for coming together to write what he called a very good bill. Michael Bowman reports from Washington.
Reports from Capitol Hill say the latest version of the bill to bail out America's troubled financial institutions preserves the Bush administration's central goal of setting up a massive government fund to purchase bad debt that has led to the failure of American mortgage institutions, investment firms, insurance companies, and banks.
But congressional leaders say the rescue package also establishes oversight of the bailout, as well as provisions to ensure that at least some of the public money is repaid over time and to limit the severance packages of corporate chiefs of distressed firms.
Speaking on CNN's Late Edition program, one of the negotiators, Republican Senator Judd Gregg, said he intends to vote for the package.
"This is absolutely critical for our country," Said Senator Gregg. "What we are talking about is facing [confronting] a fiscal meltdown which will mean jobs are lost, it will mean people's credit lines will dry up unless we do something here."
Not everyone on Capitol Hill is backing the new plan. Some legislators, especially House Republicans, continue to express reservations about any initiative that calls for a massive outlay of government funds to intervene in the financial crisis, pointing out that feedback from their constituents is running overwhelmingly against any taxpayer-funded bailout.
But Senate Banking Committee Chairman Democrat Chris Dodd says the current package attempts to make the best of a bad situation.
"This was not a happy day, obviously, to be dealing with this issue," said Senator Dodd. "But it is obviously very important that we try to come to an answer here that we can agree on and move forward. And so we began working on this product, which includes things like taxpayer protection, good accountability and oversight, strong language dealing with executive compensation."
Senator Dodd also spoke on Late Edition.
Both the Republican and Democratic presidential candidates gave tentative backing of the bill early Sunday, even as final details were being hammered out and the legislation was being written for release.
Senator John McCain appeared on ABC's This Week program.
"This is something that all of us will swallow hard and go forward with," he said. "Doing nothing is simply not an acceptable option."
McCain's Democratic opponent, Senator Barack Obama, said the financial rescue package appears to meet his criteria for support.
"Some core principles that I set forth at the beginning of this crisis were incorporated: making sure that we have strong oversight, that taxpayers share in the gains, if there are any when the market recovers, the insistence that homeowners get additional relief," he said.
But Obama has said that, just as important as a financial bailout package is a new stimulus package that directly benefits average Americans who are struggling in the current economic climate. Asked about Obama's call for further legislation, McCain said Congress should deal with the bailout first and consider other options only when the country's credit and financial picture has been stabilized.