Senate Passes Bailout Bill

123jump.com Staff
02 Oct, 2008
New York City

The U.S. Senate overwhelmingly approves the financial market stabilization bill with $700 billion provisions. The unpopular bill has been termed by the public as bailout bill that was rejected by the U.S. House. Presidential and vice presidential candidates voted in favor of the bill.

[R]12:30AM New York – The U.S. Senate overwhelmingly approves the controversial bank bailout bill. The U.S. India nuclear deal was approved with larger majority.[/R]

The U.S. Senate voted in favor of the financial markets stabilization bill with 74 to 25. The Senate needed 60 votes to pass the bill.

Presidential candidates Barack Obama and John McCain and vice presidential candidate Senator Joe Biden voted in the favor of the bill. Senator Hillary Clinton voted in favor the bill as well. The passage of the bill attracted approval from 40 Democrats, 33 Republicans and one independent Senator.

The three-page proposal from Treasury Secretary Henry Paulson turned into 400 pages of legislation in the Senate version of the bill. The Senate bill expands the Treasury authority to purchase $700 billion of mortgage securities but also added lot of oversight provisions and curbed executive compensations of institutions that participate in the bailout programs.

The approved bill increases the federal deposit insurance coverage for bank accounts to $250,000 from $100,000 effective through 2009 and increase the credit line for insurance program of the Federal Deposit Insurance Corp or FDIC from $30 billion to unlimited credit line with Treasury.

The Senate bill includes a provision for tax code change amounting to $149 billion of tax reliefs over a period of 10 years including relief in alternative minimum tax for individuals and tax credits for research and developments; important to technology, pharmaceutical and chemical industries.

Nearly 24 million households will receive relief in the alternative-minimum tax beginning next year and the bill has a provision of $17 billion in credits for development and use of alternative energy from solar, wind, geothermal and other forms of renewable energy.

The bill was defeated in the House in a 228-205 vote with 140 Democrats and 65 Republicans voting for the bill. Nearly 60% of Democratic caucus voted for the bill and 33% of the Republicans in favor. The bill is now sent to the House plans for a vote on Friday.