House — and Ramstad — prepare for tough vote on bailout package

WASHINGTON, D.C.—By a comfortable margin — 263-171 — the House today passed an unprecedented rescue plan that aims to bail out the troubled financial industry.

Republican Rep. Jim Ramstad was the only member of Minnesota’s House delegation to reverse his vote today and vote for the $700 billion financial bailout plan, which had been rejected in the House Monday and revised for today’s vote.

Also voting for the package were Democrats Keith Ellison, Betty McCollum and Jim Oberstar, and Republican John Kline. Republican Michele Bachmann and Democrats Collin Peterson and Tim Walz voted against the plan.

For Ramstad it was arguably the toughest vote of his career as he prepares to leave office after 18 years in Congress.

On Monday, Ramstad, who is retiring this year, voted against the package, calling it a plan that “imposes great risk to taxpayers and no guarantee of success.”

But soon after that vote Ramstad found his mental health parity bill, a measure that requires employers to treat mental health illnesses the same as physical illnesses in their health care plans, at the center of the bailout debate.

Along with other tax-related measures, the parity bill was added to the package passed by the Senate Wednesday night.

For days after the mental-health legislation was added to the bailout package, Ramstad weighed his choice: vote against the bailout and potentially sink his life’s work or support a plan that he simply didn’t agree with.

On Thursday, Ramstad announced his would vote for the measure. “The inclusion of [mental health] parity, tax extenders and the F.D.I.C. increases has caused me to reconsider my position,” told the New York Times.

Most insurance plans now require mental health patients to pay more of the initial costs of their care through higher deductibles and co-payments. Many insurance plans also strict limits on how often patients with mental problems can seek care. According to Associated Press, the parity legislation is expected to cost the federal government about $3.4 billion over 10 years because employers will have more health expenses that they can deduct from their income taxes.

Other provisions added
The mental health plan wasn’t the only provision that was added to the bailout package, which was defeated Monday in the House 205-228 (218 votes were needed for passage). Tax provisions and other measures were added as House leaders tried to find those extra 13 votes for passage. In the end, there were 58 more votes for the package today than the earlier version that failed.

Supporters of the package secured Ramstad’s support, but for others the tax cuts seemed only to solidify their opposition to the bill.

After today’s vote, Walz issued a statement saying he could not “in good conscience vote for this bill.”

He said he opposed the bill because it lacked a mechanism for guaranteeing that taxpayers get their money back from Wall Street and because “few if any homeowners will get mortgage relief.”

“The economic crisis facing the nation is serious and real,” said Walz.  “Inaction is not an option.  We must move fast to address it, but after you peel away all the extras the Senate added, this is still the same bad deal for taxpayers I voted against on Monday.”

Catharine Richert reports on developments in Congress, agriculture issues and other topics. She can be reached at crichert [at] minnpost [dot] com.

Comments (3)

  1. Submitted by Susan Lesch on 10/03/2008 - 11:40 am.

    The bailout media blitz will be defeated today in the House or I’ll be a monkey’s uncle. The FDIC “sweetner” is a temporary measure through December 2009, not protection forever. The CBO projected a 15% increase in deposits but I don’t think moving money around over a one year time frame will gain many people any advantage. Good luck to those willing to stand up and vote no bailout today.

  2. Submitted by Bernice Vetsch on 10/03/2008 - 04:47 pm.

    I have contacted a number of members of the relevant committees and congressional leaders this past week to ask WHY they were not considering any of the alternatives put forth by a slew of economists (not from Wall Street) that would increase lenders’ equity without sinking $700 billion into their “toxic assets.”

    Early this morning, I received an e-mail from the Progressive Democratic Caucus (www.democrats.com) in which they urged calling our representatives in support of Representatives DeFazio’s bill … a bill that calls for the government to purchase equity and instead of the wasteful purchases and protects ordinary taxpayers.

    WHERE HAS THE MEDIA BEEN WHILE THIS BILL WAS PREPARED AND OFFERED TO THE HOUSE LEADERSHIP? I’m sure DeFazio and others must have tried to get the word out. And why did that leadership not send it to the floor instead of the dangerous Paulson plan? Is anyone else furious?

  3. Submitted by Susan Lesch on 10/06/2008 - 02:14 pm.

    Dear Bernice Vetsch, I was sorry to have missed you at the MinnPost first birthday party and again at the vice-presidential debate. It would have been an honor to meet you.

    Regarding your comment I read this morning that even Mr. Buffett may have been off a tad in his timing.

    The Federal Reserve 9th District public affairs office kindly returned my call with a pointer to federalreserve.gov and a report they term technical on H41(sp?) and other reports in their statistics and economics research section. I bet you could write up a great proposal. Cheers.

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