WASHINGTON — Republican Sens. Susan Collins and Olympia Snowe of Maine welcomed with gravity the U.S. Senate’s passage Wednesday night of a revamped $700 billion financial rescue plan.
“I feel like I did the right thing but I am sad,” Snowe said. “The American people didn’t deserve this.”
“It shows that when confronted with a serious economic crisis, the Congress can come together in a bipartisan way,” Collins said. “This legislation is necessary in order to avert an economic catastrophe that would have devastating consequences for anyone who relies on credit.”
Collins and Snowe said the modified version of the bill addressed the concerns they had.
“Compared to the Treasury proposal, there is much stronger oversight and accountability,” Collins said. “Those changes were critical to me supporting the bill.”
Both senators said they supported the Senate version of the bill that the House defeated Monday in part because of the additional protections for taxpayers, the curbs on executive compensation, and stronger accountability. The plan limits corporate tax deductions on executive compensation in excess of $500,000 and on golden parachutes.
“What we can do is ensure taxpayers are protected and these protections are embedded in this legislation,” Snowe said. “Then we’ll have to find out who is responsible. Somebody has to be responsible.”
The major changes to the House bailout plan is a one-year increase in the cap on federal deposit insurance, from $100,000 to $250,000, for banks and credit union accounts, and the extension of business and individual tax breaks that had expired.
The Senate financial rescue plan’s extension of tax breaks for businesses and individuals includes tax credits for the production and use of renewable energy sources.
Snowe said she supported the tax package attached to the plan but expressed doubts regarding the future of the plan.
“I don’t know if it’s going to work for or against us,” she said. “I guess somebody thought it would help us.”
The major provision of the bailout plan, giving $700 billion to the treasury secretary to buy troubled assets from banks, remains unchanged, as do provisions establishing an oversight board and creating safety measures for taxpayers.
The rescue plan is now headed to the House, where lawmakers are expected to vote on Friday on the modified version of the bill. Maine’s Democratic Reps. Tom Allen and Mike Michaud split their votes on the original bailout plan Monday when Michaud joined the majority in defeating the measure that Allen supported.
The bill’s failure that day echoed in the financial markets with the Dow Jones industrial average plunging by 778 points, the most ever for a single day.
Snowe and Collins hope the House will pass the modified version Friday to avoid further consequences on American families and the economy.
“I am absolutely worried about the consequences if it doesn’t pass the House,” Snowe said.