House Republicans shocked the White House -- and the stock market -- by rejecting the Bush administration's gargantuan Wall Street bailout today.
The House vote for the $700 billion rescue plan had been expected to be close, but the chance of it passing was doomed when 132 Republican House members voted against it. Only 66 Republicans backed their president's plan.
The impact of the vote was felt even before the voting concluded. The Dow Jones industrial average plunged as the votes were being counted and it became apparent that passage was unlikely. As the voting continued, the Dow plummeted 700 points and ended the day down 777 points.
Even after the voting was over, congressional leaders kept the vote open for another 20 to 25 minutes for some final arm-twisting in an effort to get members to switch their votes. It was soon apparent that the effort to flip votes was futile, and the final vote was 228 against, with only 205 for the bill.
Most Democrats supported the White House on the issue, with 138 of them voting for it, but even among the Democrats 95 opposed the measure.
Key to the defeat, however, was the Republican rebellion against the White House plan. The GOP rebuff came despite serious lobbying by President Bush and his top team. Bush appeared on television early today to encourage Congress to vote for the package and to give lawmakers cover with angry voters back home.
A White House spokesman said that Bush was "very disappointed."
"There's no question that the country is facing a difficult crisis that needs to be addressed," White House deputy press secretary Tony Fratto told reporters. He said the president will be meeting with members of his team later in the day "to determine next steps."
Barack Obama, the Democratic candidate for president, quickly addressed the issue during a campaign rally in Colorado, promising, "We are going to get this done."
"I'm confident we are going to get there, but it's going to be a little rocky," said the Illinois senator. "It's like flying into Denver. It's not always fun going over those mountains, but you're confident you're going to get there."
A spokesman for John McCain blamed the bill's defeat on Obama and the Democrats.
"Barack Obama failed to lead, phoned it in, attacked John McCain, and refused to even say if he supported the final bill," McCain's senior economic adviser Doug Holtz-Eaken said in a statement. He said the Democrats attacked McCain as soon as he suspended his presidential campaign to get involved in the talks last week and kept up the criticism during the negotiations.
"This bill failed because Barack Obama and the Democrats put politics ahead of country," Holtz-Eaken said.
The bickering over the vote began immediately with Republicans alleging that a speech by House Speaker Nancy Pelosi blaming the crisis on the policies of the Bush administration prompted wavering Republicans to vote against the bill.
"We could have gotten there today had it not been for this partisan speech by the speaker on the floor of the House," said Rep. John Boehner, R-Ohio, the House minority leader. He said Pelosi's speech "poisoned" efforts to get Republicans to back the bill.
During a news conference by House Democrats, Rep. Barney Frank of Massachusetts said he was "appalled" by the accusation.