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"Bailout" Rejected by House

September 29, 2008

Today, the House voted 228-205 to reject the Emergency Economic Stabilization Act of 2008, the financial industry "bailout" legislation. Notwithstanding the bipartisan compromise reached over the weekend, 133 House Republicans and 95 Democrats voted against the bill. Many House Republicans are blaming a partisan floor speech by House Speaker Nancy Pelosi (D-CA) for quashing the bipartisan agreement. Other Members point to an array of substantive flaws with the legislation, such as the cost of the bill, $700 billion. Still others disagreed with the bill's structure, priorities, and its failure to address populist concerns.

When it appeared that the measure would fail, the financial markets reacted, dropping significantly. Members of Congress are very aware of the sensitivity of the financial markets right now and are working behind the scenes to reach a new agreement. We understand that there will be no more votes today. Members are traveling to their districts this evening and will be out tomorrow in observance of the Jewish holiday, Rosh Hashanah. The earliest the House would vote again on this issue would be Thursday.

While there is still confidence that Congress will address the financial crisis with a significant legislative package, these matters are fluid. We will continue to monitor the situation and report accordingly.