The House couldn’t swallow the $700-billion bailout proposal, so the Senate added about $100 billion of incentives—mostly in the form of tax cuts. The Senate will vote on the proposal tonight and the House could decide as early as Friday whether $700 billion is too much, but $800 billion is just about right.
Altogether, the additions would swell the projected coat of the bailout from $700 billion to more than $800 billion, a frightening number to swallow for House members in tight re-election battles.
But the heart of the bill, and the opposition to it, remained the same. It would enable the government to spend billions of dollars to buy bad mortgage-related securities and other devalued assets held by troubled financial institutions. If successful, advocates say, that would allow frozen credit to begin flowing again and keep the economy from a deep recession.