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Jamie Dupree

Mortgage Bailout Politics

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Jamie Dupree
@ September 22, 2008 12:00 AM
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I'm sure most people figure that when the White House asks Congress to approve a $700 billion dollar financial bailout plan in a week, that lawmakers will buckle down and do exactly that, right?

Don't make me laugh.

Yes, both sides have been saying the right words in recent days and both sides really do want to do 'what's right' when it comes to the Wall Street/market gyrations of the past couple of days.

But I can't imagine that Democratic Leaders will just roll over and give President Bush everything he wants without trying to add in something else.

I'm not talking about pork barrel stuff, I'm talking about something that can be packaged as help for "Main Street."

Some Democrats argue that if Wall Street firms can wipe bad debt off their bottom lines, then why can't homeowners who are trying to avoid foreclosure, why can't they get help from the feds?

Members of both parties have also talked about the need for more oversight as one answer to this financial meltdown. That won't be received well in the short term by the White House.

Democrats have also talked about putting restrictions on the pay of executives at firms that sell their bad debt to the feds. In other words, if they're going to join the bailout, then they should limit the amount of money and benefits the CEO and other top execs can get.

Again, another thing likely to draw objections within the Bush Administration.

There is an outside chance that the House of Representatives could vote on this bailout legislation this week, but I would be next week is more likely.

As for the Senate, that could take a few weeks.

My forecast is that the Congress will screw around with this, and then sometime next week we will have another big jarring drop on the markets, which will then prompt lawmakers to get cracking.

All the while, both sides will be angling for advantage on this at the polls in November. As I've said before, Democrats should benefit from this, but I'm just not sure that's going to be the case.

Stay tuned.



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