US Senate passes new bailout package

Sourced from www.ibnlive.com

 

The US Senate on Thursday passed the much anticipated economic bailout plan. This bailout plan, with a price tag of a whopping USD700 billion is a result of continued bi-partisan efforts.

While 74 voted for, 25 voted against the bailout plan by the Senate.

This plan will allow the US Government to take over troubled assets from banks which will help to keep them afloat and avoid frozen credits. But will increase the burden for future taxpayers.

This version of the bailout plan has also increased the Federal Deposit Insurance Corp cap from 1 lakh to 2.5 lakh to help small businesses. The changes are aimed at the public perception that this bill will only help Wall Street, banks and well-heeled executives.

The previous bailout package was rejected in the House and the uncertainty had cost the Dow Jones index 200 points in the trading on Wednesday.
So, the US Senate planned to vote on a slightly revised version of the previously proposed rescue plan.

A group of representatives defended their vote on the bill on Wednesday, stating that there are other options that have not haven't been utilized.
"What we're saying is use every tool in the box that's appropriate for this situation," said Democrat from Texas, Lloyd Doggett.

But others in the Senate view the Bill's prompt passage as a necessity, not an option.

"It really is an issue that goes right to the heart of Main Street. If you don't have credit in America, then the Main Street can't function," said Republican from New Hampshire Senator Judd Gregg.

Senator Harry Reid, Democrat and the Majority Leader said, "I'm hopeful and confident that all sides, House and Senate, White House, will work together to achieve a goal that will be good for the American people."

Both Presidential nominees Barack Obama and John McCain were in support of the Senate plan which includes raising the FDIC Insurance cap from US USD100,000 to USD250,000.

But some House members on Wednesday warned that problems may persist even with Senate approval of the plan.

"If, and it's rumored that the Senate intends to jam through the same bill with only with a change on the FDIC limit. If they do that without a real pay for, I think there's still going to be tremendous problems in the House," said Oregon democrat, Peter DeFazio.

President Bush has warned that the situation is urgent and the consequences will grow each day this bill is not passed.

The bailout plan passed by the US Senate will rescue the battered US banking system and will go back to the House of Representatives.