Bailout Talks Go on Amid Presidential Scuffle

Sept. 26, 2008 — -- Members of Congress and Treasury Secretary Henry Paulson are expected to return to Capitol Hill this morning to try to revive a $700 billion bailout plan as it became the focus of partisan finger-pointing and attacks on the presidential nominees after a meeting at the White House.

The talks broke down late Thursday night as rebellious House Republicans "took a walk," in the words of House Financial Services chairman Barney Frank, D-Mass.

With the deal in limbo, it was also not clear whether John McCain and Barack Obama would hold their first presidential debate on schedule tonight. The debate is to be held in Oxford, Miss., but McCain has said he won't attend if an agreement is not reached on how to deal with the country's mortgage and credit crisis.

Paulson, Senate negotiators from both parties and a House Democrat emerged from Thursday night's meeting, saying that they had agreed to most, if not all of the points of a fundamental agreement announced earlier in the day, before hopes were dashed at the White House meeting.

Alabama Rep. Spencer Bachus, ranking GOP member of the House Financial Services Committee, came and went several times from the Capitol meeting -- at one point, according to Democrats who emerged, seeking clearance from House Republican Leader John Boehner of Ohio to be deputized to sit at the negotiating table. Such a request apparently was denied, and while Bachus returned to the meeting, he left soon thereafter.

"We're not going to come to a conclusion on a three-legged stool here, missing the fourth leg," said angry Senate Banking Committee chairman Chris Dodd, D-Conn., upon emerging from the meeting.

Another round of meetings of the House and Senate Democrats and Senate Republican negotiators convenes today at 11:30 a.m. ET.

Presidential Politics Enter Bailout Negotiations

Before the Capitol Hill meeting began, House Majority Leader Harry Reid, D-Nev., continued to cast blame on Republicans, and specifically McCain, the Republican presidential nominee.

Reid said McCain was "not helpful" by suspending his campaign and heading to Washington, claiming it was difficult to "understand what John McCain said at the [White House] meeting." He said the Arizona senator spoke last and only for several moments, and did not contribute anything.

"McCain only hurt this process," Reid said.

Asked whether McCain expressed interest in taking part in negotiations on Capitol Hill, Reid said, "No."

Soon after Reid's comments, which followed another blast at McCain by Frank, the McCain campaign suggested Obama, the Democratic presidential nominee, was at fault.

"At today's Cabinet meeting, John McCain did not attack any proposal or endorse any plan," said a statement from the McCain campaign. "John McCain simply urged that for any proposal to enjoy the confidence of the American people, stressing that all sides would have to cooperate and build a bipartisan consensus for a solution that protects taxpayers.