House members in both parties divided over bailout

Eight members of Congress camped around a witness table in a cramped committee room Monday, seething about the mammoth bailout for Wall Street being sought by the Bush administration.

“If you want something next year for veterans, it won’t be here,” fumed Rep. Lloyd Doggett (D-Texas) as dozens of staffers, some lining the wall, listened intently.

{mosads}Adding insult to injury, said Rep. Brad Sherman (D-Calif.), other Wall Street firms were jockeying to get the contract to manage the toxic portfolio Treasury Secretary Hank Paulson wants to take on. No small businesses. No minority-owned businesses.

“There’s no cronyism, except to the extent he’s able to conceal it,” quipped Sherman.

Some wanted to try to stop the whole plan. Others joked that they might have to settle for “a few little weenie conditions,” like limits on executive pay. Several wanted to make sure that the plan gets “paid for” with taxes on the wealthy.

“I’m not saying no to any idea ever,” Doggett said. “I’m just saying no today until we get some questions answered. To do this on a moment’s notice is irresponsible.”

Rep. Bob Filner (D-Calif.) jumped in, “But there has to be enough of us to say that to make a difference.”

It was an impromptu meeting. Sherman, railing against the plan in a one-minute floor speech, had invited skeptics to drop by 2220 Rayburn on Monday afternoon. The location turned out to be the House Financial Services Committee meeting room, the domain of Rep. Barney Frank (D-Mass.), the Democrats’ lead negotiator.

Similar conversations took place around the Capitol on Monday in hallways, elevators and meeting rooms elsewhere, even as leaders and key committee chairmen negotiated with administration officials on the plan. Discontent came from all corners, from the most conservative to the most liberal, presenting challenges to legislative leaders of all stripes as they try to steer the plan through rocky legislative waters roiled by a looming national election.

It was far from clear whether the frustration was the start of an effort to derail the bailout, or simply lawmakers blowing off steam before bowing to the inevitable.

But it was clear that no one was in the mood to make anything easier for Paulson, House Speaker Nancy Pelosi (D-Calif.) or Republican leaders.

On the other side of the aisle in the House, the conservative Republican Study Committee (RSC) held an emergency meeting Monday night to finalize an alternative to the administration’s plan.

Sources said the details of the RSC plan will be released on Tuesday and will include possible amendments to the yet-to-be-released Paulson bill.

The group’s chairman, Rep. Jeb Hensarling (R-Texas), had already expressed skepticism regarding the Treasury’s proposal on Friday, saying he was “unconvinced that this is the proper remedy for our nation at this time.”

Former Chairman Mike Pence (R-Ind.) came out against the idea of a government bailout in a statement on Saturday.

“Congress must not hastily embrace a cure that may do more harm to our economy than the disease of bad debt,” he said.

Rep. Scott Garrett (R-N.J.), in a letter to colleagues, circulated alternatives to the bailout plan crafted by economists at the Brookings Institution, the Heritage Foundation and the University of Chicago.

“As in most cases, there is not just one solution to a public policy problem,” Garrett wrote.

And on the Democratic side, Rep. Jerrold Nadler (D-N.Y.) was concerned enough about the administration’s Wall Street bailout plan that he called Rep. Lynn Woolsey (D-Calif.) at her Sonoma home early Monday to ask to convene the Congressional Progressive Caucus.

The meetings were a prelude to the Democratic Caucus meeting Monday night and the Republican Conference on Tuesday. Democratic and Republican leaders have expressed general support for the idea of a bailout plan, though Democrats are pushing for more conditions, and President Bush criticized those who want to add “unrelated provisions.”

House Democratic Caucus Chairman Rahm Emanuel (Ill.) responded that it was time for Bush to “turn the lights back on in the Oval Office” and address the nation.