State News

N.C. Republicans, 3 Democrats help defeat bailout

Posted September 29, 2008 3:14 p.m. EDT
Updated September 30, 2008 5:48 p.m. EDT

— Three of North Carolina's seven House Democrats joined their Republican counterparts in voting against a now-defeated $700 billion emergency package for the country's financial sector Monday.

All six Republican House members were joined by Democratic Reps. Heath Shuler, G.K. Butterfield and Mike McIntyre in voting down the bailout package backed by President Bush.

"While I believe that something must be done swiftly to stave off a financial crisis, I'm not convinced that this particular plan is the answer," said Rep. Sue Myrick, a Charlotte Republican, in a statement announcing her decision to vote no.

The package sunk on a 228-205 vote, even after Democratic leaders stalled during the roll call to try to persuade members to change their vote to get the measure passed.

Only four North Carolina Congressmen - Democratic Reps. David Price of Chapel Hill, Brad Miller of Raleigh, Mel Watt of Charlotte and Bob Etheridge of Lillington - supported the plan.

Rep. G.K. Butterfield, a Democrat from Wilson who voted no, said the package was rushed and didn't include enough protections to prevent home foreclosures, for example, by empowering bankruptcy judges to modify mortgage terms. The defeated plan was the result of intense, closed-door bargaining this weekend to modify an original plan brought forth by the Bush administration.

"Unfortunately, the rush to respond has resulted in a plan that is too risky and gives away too much without any guarantees that the problems will be corrected," Butterfield said in a statement. "While people talk about stabilizing the markets, we should be focused on stabilizing families and our rural communities."

And Rep. Robin Hayes, a Concord Republican, said he voted against the plan because it didn't include a provision which would have prevented foreign banks and investment firms from receiving taxpayer assistance.

The package would have allowed the federal government to buy bad mortgages and assets held by troubled banks and financial institutions. Lifting those debts was supposed to encourage those companies to lend, thus easing the credit crisis.

Hayes' Democratic challenger, Biscoe high school teacher Larry Kissell, said he also was inclined to vote against the proposal, largely because he felt the package was too focused on helping financial firms, not taxpayers.

"The focus has to be on Main Street and not on Wall Street," Kissell said.

Democratic challenger Daniel Johnson, who is running for the 10th district seat held by Patrick McHenry, also said he didn't support the plan. He said voters simply weren't convinced that their money would be used wisely.

More than two-thirds of Republicans and 40 percent of Democrats in the House opposed the bill.

Miller, one of the four who voted yes, said he reluctantly supported the package because he thought it would bring stability to the nation's markets and struggling economy. He said the bill was a "dramatic improvement" on the package originally proposed by President Bush.

But the Raleigh Democrat also said he wished the package include more substantial provisions to address predatory consumer lending practices and tougher restrictions on compensation for senior-level executives.

"I regret that this bill does not do more for families living in houses that they could afford, but are stuck with abusive mortgages that they can't," Miller said in a statement.