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Loads of Pork, Little Accountability in Senate Bailout Bill: Will the House Balk?

Posted Oct 02, 2008 10:11am EDT by Aaron Task in Investing, Recession, Banking

By a healthy margin, the Senate passed the $700 billion bailout package last night, setting the stage for a do-over in the House, which is expected to vote on the bill Friday.

The House rejected the original bill on Monday but the revised bill contains a lot of "sweeteners" designed to garner enough votes, including $100 billion in tax relief, a widening of the FDIC insurance cap to $250,000 and aid to rural schools.

But the Senate bill is also laden with pork, including:

  • $223M for Alaskan fisherman
  • $192M for rum producers in Puerto Rico and the Virgin Islands
  • $128M for auto racing
  • $33M for companies operating in American Samoa
  • $10M for film & TV production
  • $6M for producers of wooden arrows

Those 'earmarks' may not be palatable to many House members, especially those concerned about fiscal spending and/or getting reelected.

Notably, overseas markets were mixed in reaction to the Senate passage and U.S. stocks got off to a very weak start Thursday. At 10:15 a.m. EDT, the Dow was down about 200 points, or 2%, while the S&P and Nasdaq were each down about 2.3%.

Whether the market is telling us the bill won't work or won't pass the House is unclear -- although maybe the answer is both.

Meanwhile, Todd Harrison, CEO of Minyanville.com, says more time should be given to what's not in the legislation. His wish list includes:

  • More protection for savers and penalties for bad actors
  • Regulation of the credit derivatives markets
  • Accountability and culpability for this mess, up and down the food chain
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406 Comments

Doug C
Doug C - Thursday October 02, 2008 10:11AM EDT

The leaders of both the Republican and Democratic Parties are rushing ahead with their $700 billion bill, says Bob Barr, the Libertarian Party candidate for president. Without a single hearing and without considering other solutions, Congress is preparing to put the typical American family on the hook for more than $8,000. Legislators in both parties need to stand up for the American people and say no, says Barr. www.lp.org

Mike
Mike - Thursday October 02, 2008 10:13AM EDT

Wooden arrow's WTF!!!!!! I am in the wrong business...

RonK
RonK - Thursday October 02, 2008 10:14AM EDT

This should be called the BULL&^&% Bill. This is the first time in my life Liberals and Conservatives agree on something. Let the markets work this out. Imagine what this country could do with 700billion. Health care, road construction, schools etc. Tell you congressman this vote should go down in flames. In November what these pork spenders out of office

Yahoo! Finance User
Yahoo! Finance User - Thursday October 02, 2008 10:14AM EDT

Where is my earmark??????? Where is my bailout???????

AlB
AlB - Thursday October 02, 2008 10:15AM EDT

Is it possible to determine who attached these "earmarks"?

Jim
Jim - Thursday October 02, 2008 10:16AM EDT

EMO time... Seems business as usual, nobody listens to the voters anymore. Sell all your assets, have a six pack and ask for a hand out.

ansarb
ansarb - Thursday October 02, 2008 10:18AM EDT

laden with pork , I was really pleased that both sides were getting somewere, but this , laden with pork at a time like this wont get us any were.

naragonl
naragonl - Thursday October 02, 2008 10:20AM EDT

It's time for a tea party in Boston.

Roy
Roy - Thursday October 02, 2008 10:20AM EDT

$128M for auto racing? What the hell. Are we really paying for all this crap. I can understand maybe the Fisherman but Wooden Arrows? Come on. I think everyone in congress needs to lose there jobs, Dems and Rep.

r13
r13 - Thursday October 02, 2008 10:21AM EDT

I guess we should not be surprised at the gifts for rum producers, Alaskan fishermen, and makers of wooden arrows larded into this legislation. It shows the same quality of thinking that went into the previous version.

Yahoo! Finance User
Yahoo! Finance User - Thursday October 02, 2008 10:22AM EDT

Silver Surfe here ... No Bail Out ... Write the Great American Plan with me after we beat this down. Victory is sweet with the Sweetners gone. Vote them out when they vote yes.

Rutro
Rutro - Thursday October 02, 2008 10:22AM EDT

I agree with all the above. Look out average American family. Vote no house of rep's, WE are Watching!!

Allen
Allen - Thursday October 02, 2008 10:22AM EDT

Wooden Arrows? WTF?

Heike
Heike - Thursday October 02, 2008 10:23AM EDT

that is our congress again lets just get back to the core of what we have to do get it done with out all the bull

Raymond
Raymond - Thursday October 02, 2008 10:23AM EDT

If this doesn't pass, no jobs, no credit, no joe six pack. Let the House remove the pork. Pahlin must have her hooks in the fishermen .

p
p - Thursday October 02, 2008 10:24AM EDT

real news WOULD report on WHO the congressman was that attached said "earmarks"

toofast4u
toofast4u - Thursday October 02, 2008 10:24AM EDT

Once again, congress is more worried about votes back home with their pork barrels then concerning themselves with the overall good of the country. If they are not stealing or being bribed they are padding their own pockets. We need some accountability in Washington and someone with enough Bxxxs to veto this type of spending. Maybe we need someone who can shine a little light on the actions of these congress people so when it comes time to be re-elected the voters know exactly who has their hands in their pockets

Yahoo! Finance User
Yahoo! Finance User - Thursday October 02, 2008 10:24AM EDT

Silver Surfer here... Unfortunately this is no joke... This type of legislation can enslave our childrens future... Stop the Bail Out... Write the Great American Plan once we defeat this garbage.

Michael
Michael - Thursday October 02, 2008 10:26AM EDT

The Senate has the gall to add crap to this bill? WFT! What a bunch of greedy, ignorant morons. Sweeteners? I am too pissed off to listen to the news, and these pricks pass this crap by a 74-25 vote?

Thomas
Thomas - Thursday October 02, 2008 10:26AM EDT

We need a Boston Tea Party...

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