"What's important here as well is to calm people's fears," Dodd said in an interview on CBS' "The Early Show."
He also drew a distinction between last week's failure of IndyMac Bank — which engaged in originating riskier mortgages than traditional community and regional banks — and the two mortgage giants.
"There's a big difference between IndyMac and Fannie and Freddie," Dodd said. "IndyMac engaged in very bad mortgages, luring people into deals they could never afford. That's not the case with Fannie and Freddie." Dodd said while there may be more bank failures, "I'm more optimistic about Fannie and Freddie than I am about these banks."
The White House, in a statement, said President Bush directed Paulson to "immediately work with Congress" to get the plan enacted. It also said it believed the steps outlined by Paulson "will help add stability during this period."