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House, in second effort, passes bailout bill
White House promises quick enactment of massive Wall Street rescue plan

The House passed a $700 billion bailout of the financial services industry Friday, reversing itself after members who voted to kill the measure earlier in the week came around to a Senate version that offered more protection for individual investors and small businesses.

Stocks were up moderately after the successful vote, paring earlier gains.

After a week of reversals and intense lobbying, the measure ended up passing comfortably by a vote of 263-171. After seeing the bill go down to defeat Monday, House Speaker Nancy Pelosi, D-Calif., had said she would not let it come up for a vote Friday unless it was clear that it would pass.

White House spokesman Tony Fratto said President Bush would "like to sign it as quickly as possible "? as soon as they get it to us."? House staffers said it would be sent to the White House as early as Friday afternoon for Bush's signature.

Under the plan, the Treasury Department would be authorized to spend as much as $700 billion to buy bad mortgage-related securities, which have slowed and, in some cases, dried up the flow of credit.

The Senate dramatically changed the measure Wednesday, adding an additional $110 billion in additional tax breaks, incentives and other measures, including an expansion of coverage of individual bank deposits by the Federal Deposit Insurance Corp.

Leaders sought 12 new votes
The calculus for Pelosi and other House leaders was whether the additions would lure enough support to overcome new objections from conservative members to the added costs.

"House and Senate leaders promised the bill wouldn't be a Christmas tree of add-ons, and in a matter of days it's gone from a Charlie Brown Christmas tree to Rockefeller Center,"? said Rep. Steve LaTourette, R-Ohio, who led efforts to strip out what he called "egregious"? tax breaks. "It's Christmas in October."?

But Majority Leader Steny Hoyer, D-Md., said compromise was needed. He said that while he strongly opposed the Senate's decision to pay for many of the tax breaks with debt, he could not forget everyday Americans at home who were struggling.

"For their sake, we must act,"? Hoyer said in a floor speech shortly before the vote.

In the end, that argument turned the outlook of 55 House members, including Zach Wamp, R-Tenn.

"We're out of choices. Our backs are up against the wall,"? Wamp said.

House leaders said the difference was lawmakers' work to shift the focus from the bailout of financial companies to the boost it would give homeowners, small businesses and individual investors.

"All the attention was on Wall Street, and we wanted to turn that attention,"? Pelosi said after the vote.

Financial institutions were "recently left unregulated and undisciplined and unsupervised, and they created chaos,"? she said. "That was then. This is now. We're about the future."?

Rep. Jim Clyburn, D-S.C., the Democratic whip, concurred, saying that ""?bailout' is an inaccurate way to describe this package."?

"I think that we have come up with an incredible piece of legislation that addresses not just Wall Street but also Broad Street,"? the main business district of his hometown, Sumter, S.C.

Bad news spurs urgency
Pressure on holdouts grew Friday after the Labor Department said the economy lost 159,000 jobs in September, the most in more than five years, a worrisome sign that the economy is hurtling toward a deep recession.

That came on top of Thursday's Commerce Department report that factory orders in August plunged by 4 percent.

Bush lobbied aggressively for passage of the bill, which Fratto, his spokesman, said was not necessarily intended to boost the economy. "It's to avoid a crisis," he said.

The two major party presidential candidates, Sen. Barack Obama, D-Ill., and Sen. John McCain, R-Ariz., also supported the bill and worked to ensure its passage.

The vote was House leaders' second stab at the legislation after the Senate jumped the line and passed its revised version Wednesday.

"The Senate may have taken us hostage,"? said Rep. Barney Frank, D-Mass., chairman of the Banking Committee. "They may have us at arrow-point, and we may have to vote for this even with their obnoxious provisions."?

Some of those provisions were not so obnoxious to business owners like Carl Adams, a real estate agent in Paducah, Ky. Preserving banks' ability to fuel the economy is crucial, he said, but to do that, the banks have to stay healthy.

"If the banks' money dries up "? in other words, they can't afford to lend us money for our clients "? then you're going to see everything snowball from there,"? he said.