WASHINGTON -- Senate leaders have scheduled a vote for Wednesday on the $700 billion Wall Street rescue plan.
The plan was rejected by the House by a narrow margin Monday.
However, the bipartisan move caps a day of behind the scenes maneuvering on Capitol Hill to try and bring the whole plan back to avoid a collapse of more financial institutions.
Many lawmakers are confident a vote can happen by the end of the week.
“We have to put Humpty Dumpty back together again and get it passed in the House and Senate,” said Sen. Jon Kyl. “And there seems to be a great deal of good will on both sides of the aisle and in both the House and the Senate to get this done, and get it done before the end of the week."
One big addition to the Senate version is a plan to raise the amount the government will back on personal accounts from $100,000 to $250,000.
Both Sen. Barack Obama and John McCain said they will be back in Washington for the vote.
Bush: Economic Damage Will Be 'Lasting' If Bailout Not Passed
President George W. Bush has issued a warning to Congress: act now on a financial rescue plan or the economy could face "painful and lasting" damage.
In brief remarks at the White House Tuesday morning, Bush pledged that his administration will work with congressional leaders to get the defeated $700 billion relief package back on track, saying "this is not the end of the legislative process."
While conceding the proposal is huge, he noted that it was dwarfed by the trillion dollars lost in Monday's stock-market plunge. He said that "will have a direct impact on retirement accounts, pension funds and personal savings" of millions of Americans.
Bush also said the actual cost to the taxpayers should end up much less, arguing that once markets recover, the assets the government buys likely will gain value.
While acknowledging it's "a difficult vote for members of Congress," Bush called the situation "urgent," saying the consequences of inaction "will grow worse each day."
Stock Market Reaction
Meanwhile, world markets reacted Tuesday after the U.S. stock market suffered the biggest point drop in American history Monday, after the House defeated a $700 billion emergency rescue package.
Stocks started plummeting on Wall Street even before the 228-205 vote to reject the bill was announced on the House floor. The Dow Jones industrial average closed down 777.68 points, or more than 6 percent, surpassing the record set on the first trading day after Sept. 11, 2001.
On Tuesday, the Dow gained about 500 points from its dive on Monday.
This is the third highest point gain ever.
The rally was led by speculation lawmakers will be able to come to some sort of deal.
We spoke with financial expert Ed Cofrancesco Tuesday afternoon who agreed.
“(Yesterday you told me the market hates uncertainty, is the uncertainty still out there though?) The uncertainty is still out there but I think the market believes we're going to get some bill passed, maybe not like the bill that was voted down yesterday, but some semblance of a bill by the end of the week,” said Cofrancesco.
A new report on consumer confidence also helped prop investors up.
What’s Next For The Bailout Plan?
Leaders are trying to figure out what to do next after House lawmakers failed to pass the $700 billion bailout plan.
The next step is unclear, as House members break for the Jewish holiday of Rosh Hashana. They are scheduled to reconvene Thursday.
The package, which Democrats and Republicans had seemingly gotten behind before the vote, needed 218 votes to pass, but only 205 lawmakers voted in favor of the plan.
Two-thirds of Democrats and one-third of Republicans voted for the measure.
Treasury Secretary Henry Paulson continues to insist the worst is yet to come without the bailout.
How Central Florida Voted
Yea:
- Rep. Corrine Brown, D-Jacksonville
- Rep. Adam Putnam, R-Bartow
- Rep. Dave Weldon, R-Melbourne
Nay:
- Rep. Ginny Brown-Waite, R-Brooksville
- Rep. Tom Feeney, R-Oviedo
- Rep. Ric Keller, R-Orlando
- Rep. John Mica, R-Winter Park
- Rep. Cliff Stearns, R-Ocala
Contact Your U.S. Representative
Lawmakers Jobs At Risk?
Two-thirds of Congress' most vulnerable members from both parties voted against the massive economic rescue package, most fearing they could lose their jobs.
Of the 19 most vulnerable House lawmakers tracked by The Associated Press, 13 voted against the bill, despite pleas from their party leaders.
Many said they could not vote for a bill that would allow some executives of the failed companies to be paid many times what their cash-strapped constituents could ever hope to earn.
Some of those who voted for the bailout said they did so in possible conflict with the districts they represent.
What To Buy With $700 Billion
If the $700 billion price tag attached to the bailout plan that failed sounds like a lot, it is.
With that amount, one could buy a war. The U.S. has spent close to that amount on the war in Iraq so far.
That much money could ensure universal health care coverage for six years, or upgrade the country's most deficient bridges four times over.
A $700 billion check could also pay back every single outstanding student loan, or fund the National Intelligence Budget beyond 2020.
How The Crisis On Wall Street Affects You
The financial crisis is creating some scary times for Americans who are wondering just how the meltdown really affects them.
A more obvious effect this may have is on stock portfolios or retirement plans, but it also makes it incredibly hard to get credit, even for those who already have excellent credit scores.
Banks currently do not have the ability to finance lines of credit, and that affects people looking for a loan, mortgage or even a credit card.
The crisis also affects companies, both large and small, from getting the money they need to expand their business. With no expansion, there can be no new jobs.
More on the Bailout Plan
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