Political Capital with John Harwood

GOP Feels Home Front "Heat" For Congressional Housing Bill

J. Scott Applewhite

The rapid progress in Washington on bipartisan housing legislation, as on the earlier stimulus legislation, shows how strongly fear can change the mind of politicians.

Congressional Republicans, taking cues from their free-market leader at 1600 Pennsylvania Avenue, had generally been keeping their distance from the idea that further action is necessary on the housing mess.

But over the Easter recess they got an earful from constituents anxious about the weakening economy--and uneasy over the fact that Washington seemed to help Bear Stearns more than it had helped worried homeowners.

And those Republican incumbents know they'll have to face voters in November and beyond, while George W. Bush will be enjoying retirement at his Texas ranch.

That's why Republicans and Democrats are suddenly coming together around the idea of another $10-billion for state bonds to ease local housing markets and $15,000 tax credits for those purchasing new vacant homes, among other things.

That's also why John McCain has maintained maximum flexibility in his Republican presidential campaign, invoking free market principles and discipline but not ruling out additional federal help.

Stay tuned. The ground is shifting and may shift a lot more in the seven months remaining before Election Day.

Waiting on Bernanke

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