Rescue bill said to be gaining in US House

02 October 2008 20:14  [Source: ICIS news]

WASHINGTON (ICIS news)--There is increasing support for the $700bn (€497bn) financial bailout bill in the US House of Representatives, where a crucial vote on the rescue plan is expected soon, US business leaders said on Thursday.

 

“There is a lot of movement toward passage of this bill,” said Bruce Josten, head of government affairs for the US Chamber of Commerce.

 

Josten said that Wednesday night’s overwhelming Senate approval of the bailout proposal provided momentum for the measure as it heads for a crucial vote in the House on Friday.

 

The Senate approved the rescue measure - which provides $700bn to the US Treasury Department for use in buying up nonperforming mortgage loans and mortgage-backed securities - with a strong bipartisan vote of 74-25.

 

That heavy backing for the rescue plan among both Democrats and Republicans in the Senate puts more pressure on the House for its approval.

 

“We think it is important now that the House follow the lead that the Senate put down and move with all deliberate speed to approve this,” Josten said.

 

“This crisis cannot be allowed to go beyond Friday without action by the House to deliver this bill to the president, to get liquidity restored to financial markets and to get our economy moving again,” he said.

 

Josten said the Senate vote and the 778-point drop in the Dow Jones Industrial Average index on Monday following the House vote rejecting the rescue plan are beginning to change views in the House.

 

“This is starting to get real for people now,” Josten said. “When you see the stock market lose more than a trillion dollars in the space of two hours and the effect that had on people’s savings and retirement accounts, it is starting to get real for people [in the House].”

 

“Our members are telling us every day that credit is either not available or it is so tight and costly as to be unavailable, and that they will be forced to begin laying off workers in the next month,” Josten said.

 

The US Chamber of Commerce, a private business group, has 3m member firms, including chemical manufacturers. Josten said that nearly 75% of the chamber’s member companies are small businesses.

 

Josten was among two dozen business leaders who met earlier on Thursday with President George Bush at the White House. He said Bush asked the company representatives to contact their representatives in the House, and the president pulled out a list of House members that he was preparing to call.

 

Josten said he is hopeful of House approval of the bailout bill on Friday.

 

“I would be shocked if Congress were to decide to leave town this Friday without acting on this and then go home and risk an economic calamity,” he said.

 

($1 = €0.71)

 

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