The Financial Crisis: This Day—One Year Ago, Sept. 27, 2008
Bailout politics arise.
Saturday seems more sedate than it has in weeks, but it's a false calm, as Washington scrambles to find common ground on a financial rescue plan.
House Democrats issue a strongly worded memo denigrating an alternative bailout proposal from House Republicans. The memo says the GOP plan would amount to "a true bailout of Wall Street fat cats," reports Steve Liesman.
But lawmakers continue to huddle with Treasury Secretary Hank Paulson through the evening, seeking to nail down an agreement to create a massive government fund to buy up distressed debt from financial institutions staggered by failed mortgages.
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"I'm convinced that by Sunday we will have an agreement that people can understand on this bill," says Rep. Barney Frank (D-Mass.), chairman of the powerful House Financial Services Committee.
By midnight Saturday, a deal is reached.
House Republicans, who had worried that the $700-billion program would put taxpayers on the hook, win a provision that will set up an insurance program for mortgage-backed securities.
In addition, the US government will get stock warrants, in theory allowing for a return on its investment as bailed-out companies recover.
The deal looks done but legislators await full details on paper.