Minnesota senators help pass bailout bill

Senators Norm Coleman and Amy Klobuchar
Both Sen. Norm Coleman and Sen. Amy Klobuchar said they would vote for the rescue bill before the U.S. Senate.
MPR File Photo

This Senate version of the bailout plan is different from the one that failed in the House Monday.

It adds $100 billion in tax breaks for businesses and the middle class and more than doubles the limit on deposit insurance. There are incentives for the development of wind, solar and other renewable energies.

And for Minnesotans and mental health advocates, the bill has another added bonus. Tacked onto the legislation is the Wellstone Mental Health Parity Act, which would force insurance companies to treat mental illness the same as other health problems. Similar bills have failed to become law in the past.

Congressional leaders work on bailout plan
Senate Minority Whip Sen. Jon Kyl (R-AZ) (L) talks with Chairman of the Senate Banking Committee Sen. Chris Dodd (D-CT) discuss next steps in the bailout plan. Yesterday the House of Representatives defeated the Emergency Economic Stabilization Act in a 228-205 vote. Today President Bush called on lawmakers in Congress to quickly approve the proposed $700 billion rescue plan for the financial sector.
Melissa Golden/Getty Images

Republican Norm Coleman said these changes, and the strict oversight written into the bill, convinced him that voting yes was the right thing to do.

Grow the Future of Public Media

MPR News is supported by Members. Gifts from individuals power everything you find here. Make a gift of any amount today to become a Member!

"That's why I'm willing to cast a vote for this," he says. "If I thought this was simply business as usual, I wouldn't cast this vote. The original package, to me, was not acceptable," Coleman said.

The original Bush administration plan called for the Treasury to have total control over the bailout with no oversight by Congress. Coleman said he couldn't support it.

"What we were faced with originally was a proposal that said 'give the secretary of the Treasury carte blanche authority to distribute $700 billion because of a crisis.' There is a bipartisan agreement that this is an economic crisis, but what we have done now with the bill in front of us is ensure that there are provisions to provide oversight that weren't there originally."

Working on a bailout plan
Left to right: U.S. Rep. Barney Frank (D-MA), Sen. Charles Schumer (D-NY) and Sen. Christopher Dodd (D-CT) brief the media after a bipartisan meeting on Capitol Hill to discuss the Bush administration's $700 billion bailout plan for the nation's financial crisis Thursday.
Alex Wong/Getty Images

Coleman said the risk to the economy was too great to ignore, pointing to the tightening of credit for businesses and the foreclosure crisis as signs of a global financial meltdown.

The Senate bill would still give the government billions of dollars to buy mortgage securities and other assets now held by troubled financial institutions. Lawmakers say buying the bad debt will get credit moving again and prevent a recession.

Democrat Amy Klobuchar opposed the Bush administration's initial plan, but said she is satisfied with the changes they made to the new bill.

"There are a number of provisions in this bill that make it much more palatable and better for the taxpayers. Do I wish we were in this situation? Of course not, this is a sad day for America. Do I think they are going to have a parade for me when I get home for supporting this? No," Klobuchar said.

Like the House bill, the Senate version distributes the money in installments and gives Congress a say in whether all $700 billion can be spent. It adds strict rules, with a special investigator to oversee the program. And it limits compensation for CEOs whose companies get help from the rescue plan.

But Klobuchar said she is not happy about having to rescue the country's financial industry.

Bailout graphic
The proposed $700 billion bailout of the financial industry would amount to approximately $5,000 per U.S. taxpayer.
MPR Graphic/Than Tibbetts

"Equal to the anger that they feel and I feel is the realization that we can't let this get to the mainstreet level, which it is," she said.

"We are already seeing people having trouble getting car loans and student loans and so the key is to stem this crisis and then to fix it going forward. That is going to be my priority in the next few months is to change those regulations so this doesn't happen again."

An Associated Press poll this week shows 45 percent of Americans still oppose a bailout.

Coleman, who's facing reelection in November, said he knows voting for the bill won't make him popular but he felt it was a choice he had to make.

"I'd rather lose an election than see this economy crumble," Coleman said. "If I can make any difference and strengthen this economy I'm going to do it and so I'm going to cast a vote today in favor of doing that, what I believe is necessary and important to stabilizing this economy."

Now, the bill goes back to the House. On Monday, four members of Minnesota's Congressional delegation voted for it and four voted against.