Congress reaches ‘fundamental agreement’ on bailout

Democratic and Republican negotiators announced Thursday morning that they have reached a “fundamental agreement” on a set of principles for a proposed $700 billion Wall Street bailout.

Senate Banking Committee Chairman Chris Dodd (D-Conn.) said that negotiators have agreed on the framework for the economic plan, which they will present to President Bush later this  afternoon, as well as to members of their respective conferences.

{mosads}“[We’ve] dealt with the issue of oversight, homeowner preservation [and] executive  compensation,” Dodd said after emerging from a several-hour meeting with Senate and House negotiators.

Negotiators declined to provide details.

“We now need to meet with the president and go over these principles we’ve agreed on and, obviously, go back to our respective caucuses and talk to them as well,” said Dodd.

One participant in the talks said that negotiators have agreed to authorize $700 billion for the government to purchase distressed mortgage-based assets from troubled investment companies. Lawmakers are likely to allocate funds in smaller installments.

Sen. Bob Bennett (Utah), a Republican Banking Committee member who attended the meeting, predicted the agreement would win the support of other Republicans.

“I expect we will now have a plan that will pass the House and pass the Senate and be signed by the president,” he said, adding that it would provide certainty to the financial markets.

House Financial Services Committee Chairman Barney Frank (D-Mass.) said the broad agreement would address many of the concerns that members of the House Democratic Caucus raised with the bailout proposal first submitted to Congress by Treasury Secretary Henry Paulson.

“We will be able to accommodate the bulk of them,” said Frank of Democratic objections and concerns. Many Democratic lawmakers said the bailout had to include provisions that would help Americans facing foreclosure.

Congressional negotiators will meet with Bush Thursday afternoon.

Democratic Sens. Charles Schumer (N.Y.), Jack Reed (R.I.), Kent Conrad (N.D.) and Dick Durbin (Ill.) attended the meeting. Republicans included Sens. Judd Gregg (N.H.) and Bob Corker (Tenn.).

House Financial Services ranking Republican Spencer Bachus (Ala.) also attended.