The Financial System Bailout: Deal or No Deal?

Congressional leaders announce a pact in principle, but face unhappy rank-and-file Republicans. Can John McCain swing them? Does he want to?

The deal is on. No, it’s off. No, it’s on again.

It was a day in Washington that would have tried the patience of Monty Hall. After several days of nearly nonstop negotiations, congressional leaders scrambled Thursday to hammer out a compromise agreement on Treasury Secretary Henry Paulson’s proposed $700 billion financial system bailout in advance of an emergency White House meeting called by President George W. Bush.

Adding to the tension, the White House meeting was also attended by Presidential contenders Barack Obama and John McCain—who had announced on Wednesday, Sept. 24, that

he was suspending his campaign to return to Washington and help win an agreement on the controversial deal. With anxious voters ever more worried about the economy, and much of the public upset at the high cost of the bailout, the two candidates have sparred repeatedly over the last week, as each has tried to convince voters that he would be better placed to lead the nation amid the financial crisis.

By the time Obama and McCain arrived in town from the campaign trail, however, congressional leaders had already announced they had a preliminary agreement in hand. On Thursday morning, Senators Chris Dodd (D-Conn.) and Robert Bennett (R-Utah) and Representative Barney Frank (D-Mass.) said they had a deal in principle, though no details were offered. Some emerged as the day went on, but it also became unclear how solid Republican support for that deal was.  Read More

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