Jittery Markets Await Pact On Financial Bailout Plan
Even as negotiations got under way, Schumer and Senate Republican Whip Jon Kyl predicted lawmakers would quickly resolve their differences and were likely to pass a bill by week's end.
"The chances are better than 50-50 that we will get it done by the end of the week," Kyl said on Fox.
Paulson said the final cost of the bailout should fall well short of the $700 billion initial price tag since the government would be able to hold the debt until markets stabilize and prices recover.
"This is the least costly path," he said on CBS.
If the Treasury tapped its full authority, the bailout would put every man, woman and child in the United States on the hook for more than $2,000.
To cover the cost, Treasury asked Congress to hike the government's debt limit to $11.3 trillion from $10.6 trillion.
The administration and Federal Reserve have already taken several other emergency steps to try to prevent growing credit strains from engulfing the entire financial system and economy.
A $700 billion fund would push the total pledged to combat the crisis to $1.8 trillion, or $15,000 per U.S. household.
Initially, the Treasury proposed buying assets only from companies based in the United States, but Paulson laid out the case for a broader mandate to ensure credit was flowing.
"If a financial institution has business operations in the United States, hires people in the United States, if they are clogged with illiquid assets, they have the same impact on the American people as any other institution," he said on the ABC program "This Week."
The Treasury chief confirmed that hedge funds -- investment vehicles for the wealthy -- would not be eligible.
While aimed at mortgage assets, the administration's plan would even let the Treasury acquire assets from nonfinancial firms and assets not tied to mortgages if needed to promote market stability.
The plan was hatched amid grave concerns that other major banks could collapse and that credit markets were close to freezing, threatening the U.S. and global economy.
"We have a global financial system and we are talking very aggressively with other countries around the world, and encouraging them to do similar things, and I believe a number of them will," Paulson said on ABC.
Lawmakers said Paulson and Fed Chairman Ben Bernanke had offered starkly grave assessments of the economic cost of inaction in private briefings.
"What they told us was the contagion here and the depression in the market was such that you were going to see a shutdown of the lending businesses not just on Wall Street" but for all Americans, Frank said on CBS.
Bernanke on Sunday was talking by phone and meeting in person with Treasury officials and lawmakers, while Paulson also was working the phones as counterproposals emerged.
Financial markets responded positively last week as news of a large-scale financial bailout spread.
Stock markets worldwide added more than $1.5 trillion in value Friday, the largest one-day advance ever and a sign of the vital importance of the plan to global markets and investor confidence.
It was still unclear, however, whether the bailout would be enough to pull the U.S. economy out of the doldrums.
"I won't bet against the American people ... We will work through this," Paulson said on NBC. "I wouldn't bet against the long-term fundamentals of the U.S. economy."
—Reuters and AP contributed to this report