House rejects bailout; stocks plunge

A massive bill aimed at rescuing ailing financial institutions failed 205-228 on Monday during a prolonged vote on the House floor, resulting in one of the steepest drops in the Dow Jones Industrial Index’s history. 

Before the first vote was even cast, the finger-pointing began, and it didn’t relent as members on both sides of the aisle sought to cast blame and scrambled to figure out what to do next.

{mosads}“Right now I’m obviously very disappointed, but the Republicans killed this,” said Financial Services Committee Chairman Barney Frank (D-Mass.), who led the negotiating efforts on behalf of House Democrats.

Asked if he was worried about the markets, which dropped more than 400 points as soon as it became obvious that the bill was not going to pass, Frank said, “Uh, yeah!”

Frank then ducked into a Democratic leadership meeting.

Republicans exited the chamber and immediately began to lay the blame at the feet of House Speaker Nancy Pelosi (D-Calif.) for delivering what they called a blatantly partisan speech rife with demagoguery.

Republican Conference Chairman Adam Putnam (Fla.) said that “[Majority] Leader [Steny] Hoyer’s [D-Md.] comments were well-received, but hers clearly had a partisan bent.”

Rep. Joseph Crowley (D-N.Y.), who helped lead the Democratic whipping effort, adamantly rejected the GOP spin.

“They knew coming in how they would vote,” Crowley said. “The bottom line is that we said we’d get a majority of our caucus, and we did it. They did not meet their obligation.”

Democrats managed to secure 140 yes votes from their members, with 95 Democrats voting no. Republicans squeezed out 65 votes in the affirmative, with 133 members of the GOP conference casting “no” votes.

Despite vows on both sides of the aisle to deliver as many votes as possible,  and with Democratic and Republican leaders pleading with their members to vote “aye,”  only a couple lawmakers changed their votes during the roll call.

The vote on the $700 billion bill, aimed at correcting the credit crisis that has Wall Street and the world’s financial markets in a virtual lockdown, was held open by Democratic leadership for more than 20 minutes beyond the allotted 15-minute time, but to no avail.

Amid shouts of “Regular order!” from dissenters on both sides of the aisle, Democratic and Republican leaders watched as the vote tally slowly slipped away into losing territory.

Passions were high minutes before the vote. A visibly shaken Rep. Spencer Bachus (R-Ala.), who was initially rumored to be an opponent of the bill going into Monday’s vote but then spoke in favor of it on the floor, physically pushed Rep. Brad Sherman (D-Calif.), who was handing out bright green fliers on the Republican side.

He then returned to his seat behind the podium. Sherman, who voted against the bill, looked stunned for a moment, then continued speaking to Republican members.

The tally was even or close for the first 10 minutes of voting. Thirteen minutes in, though, the vote slipped into negative territory at 162-166. It never regained a majority of support.

As the number of “no” votes passed the majority threshold of 218, Hoyer began shuttling back and forth between both sides of the House well, conferring with House Minority Whip Roy Blunt (R-Mo.) and Pelosi, most of the time with Democratic Caucus Chairman Rahm Emanuel (Ill.) by his side.

After one trip, Hoyer had a brief, heated exchange with bill opponent Rep. Darrell Issa (R-Calif.), and then walked to the Democratic side, where he was immediately swarmed by Progressive Caucus members demanding regular order.

As the total dropped to 207-226, a scrum of leaders, including Frank, Emanuel, Hoyer, Boehner, Blunt, Eric Cantor (R-Va.) and Appropriations Committee Chairman David Obey (D-Wis.), gathered on the Republican side.

When the vote appeared to be locked at 205-228, Hoyer returned to having his other-side-of-the-aisle consultations with GOP Parliamentarian John Sullivan.

Pelosi, meanwhile, huddled near the well with Education and Labor Committee Chairman George Miller (D-Calif.), one of her closest advisers, as well as Crowley.

But as the calls for regular order became louder and more frequent  and the vote never changed, Pelosi began to accept the bill’s fate.

Despite some last-minute pleas from Crowley and Miller, Pelosi eventually looked at Hoyer and waved her hands.

Hoyer turned to the chair and signaled that time was, indeed, up.

In an instant, the chamber fell completely silent, as members stared up at the vote tally for a final time before the chair announced the outcome.

Rep. Joe Barton (R-Texas), who voted no, inquired with the chair about how quickly a motion to reconsider would be taken up.

The chair ruled that the question would be put to the floor for a vote, but Barton withdrew his inquiry and the motion to reconsider was tabled — a standard parliamentary move that gives the losing side the option of having the vote reconsidered.

As leaders huddled privately to ponder their next move, Crowley suggested that it was more than likely that the House would not adjourn, as it had scheduled to do Tuesday afternoon.

Neither side of the debate could say they knew what was in store for the economy, and even opponents looked solemn as they filed out of the chamber.

When asked what would happen if the markets tanked in response to the vote, Rep. Patrick McHenry (R-N.C.), who voted against the bill, shook his head as if he didn't know.

Jared Allen, Susan Crabtree, Jackie Kucinich, Michael O’Brien, Mike Soraghan and J. Taylor Rushing contributed to this report.