Bailout deal collapses, Democrats try to blame McCain

Down goes Frazier. I missed the report on Fox earlier but Ace says it sounds like the Dems are trying to shift the blame for it from the House GOP to Maverick. Fair or no? Let’s see. Dodd lands the first blow:

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Republican presidential nominee John McCain was blamed for de-railing negotiations by blindsiding lawmakers with his support for an alternative plan.

The ‘very contentious’ meeting broke up after Republican leaders said they had to go back to their rank-and-file to discuss the new proposal…

After the hour-long White House meeting, [Dodd] said: ‘What has happened here is that we have spent seven straight days to find a rescue plan for the economy.

‘What this looked like was a rescue plan for John McCain. To be distracted for two to three hours by political theatre doesn’t help.’

Democrats said the Republicans were on board with the deal until Mr McCain intervened an injected presidential politics into the situation.

The only problem? According to Marc Ambinder, citing four independent sources, McCain didn’t say much of anything during the White House meeting let alone float any alternative plans. Boehner, apparently, brought up some of the House GOP’s ideas; the Dems claim they got the impression that McCain supported those ideas, but “they concede that he did not raise them directly.” Even Reid, ever sneering, admits McCain played no major role.

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Which isn’t to say that he doesn’t, in fact, support the House GOP. Quoth The Hill from an article published earlier this afternoon:

[A] key Republican lawmaker stated that Sen. John McCain (R-Ariz.) wants to explore new ideas, like loaning money to financial institutions or insuring the companies, rather than buying their toxic debt…

Rep. Spencer Bachus (Ala.), the ranking Republican on the House Financial Services Committee, attended the meeting at which some say a deal was reached. But he later issued a statement saying he wasn’t authorized to negotiate or approve any deals for House Republicans…

He added that McCain is interested in using loans or insurance rather than having the government purchase the toxic debts of Wall Street institutions.

“We would prefer a loan or supplying insurance,” Bachus told reporters. “These are the ideas Sen. McCain tried to maximize. He feels strongly we have to design a program where taxpayers won’t lose.”

Bachus, wearing a “McCain-Palin” lapel pin, said he’d talked to McCain on Wednesday night and had breakfast with McCain’s advisers Wednesday morning.

The insurance angle is at the core of the House GOP’s alternative plan. See here for the particulars. In essence, they want to scrap a taxpayer bailout, expand the feds’ power to insure mortgage-backed securities, and lift regulations to encourage private investment and rescue the financial industry that way. As for McCain, it sounds like he’s being coy because he’s not sure yet which way to break on this politically. Better hurry up: If that Hill article I linked is correct, they’re nowhere near the 100 Republican votes Pelosi wants before she’ll send the bill to the Senate and the markets, shall we say, won’t like that. Exit question: If they can’t get a deal done to save the farking economy, will next week bring us Congress’s first ever zero percent approval rating?

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Update: For what it’s worth, here’s what HuffPo’s sources are telling them about the meeting:

Towards the end, McCain finally spoke up, mentioning a counter-proposal that had been offered by some conservative House Republicans, which would suspend the capital gains tax for two years and provide tax incentives to encourage firms that buy up bad debt. McCain did not discuss specifics of the plan, though, and was non-committal about supporting it.

Paulson, however, argued directly against the conservative proposal. “He said that he did not think it would work,” according to the source. At another point in the meeting, President Bush chimed in, “If money isn’t loosened, this sucker could go down” — and by sucker he meant economy…

Following the meeting, Democrats stayed talking in the Roosevelt room and Paulson approached them. Speaker Pelosi and Rep. Barney Frank shot back at Paulson that the real problem was with House Republicans, according to sources. Paulson replied, “I know, I know,” as he got down on one knee to lighten the mood. Pelosi joked back, “I didn’t know you were a Catholic.”

Update: An astute point from Baseball Crank. In all the frenzy over McCain, you know whose name you haven’t heard much of at all as mattering to this deal? Barack Obama’s.

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David Strom 12:30 PM | April 23, 2024
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