Bailout splits Minnesota lawmakers

Talk about it

ST. PAUL — Minnesota's U.S. representatives agree Congress needs to help fix the country's financial crisis, but on Monday divided their votes on a $700 billion plan to do that.

Rep. Collin Peterson said congressional leaders need to talk to more lawmakers than they have for the past couple of weeks.

"Clearly, they are going to have to go outside of the circle they have been talking to," said Peterson, adding that the Agriculture Committee that he leads "will be drug into this."

Minnesota's representatives split Monday as the House defeated the plan 228-205. Peterson and fellow Democrat Tim Walz voted against the proposal, joined by Republicans Michele Bachmann and Jim Ramstad. Four Minnesotans voted for the measure — Republican John Kline and Democrats Jim Oberstar, Betty McCollum and Keith Ellison.

"As it became increasingly clear that the financial crisis facing America was extending beyond Wall Street and threatening the jobs, homes and retirement security of the men and women reporting for work on main streets throughout Minnesota and across America, we were asked to cast our vote for an imperfect, but important, solution," Kline said. "Unfortunately, this bill did not pass, and the crisis continues."

Oberstar warned of consequences on stock markets, starting overseas and continuing when American markets open today.

"I think the confidence of domestic and foreign financial markets will be shaken," Oberstar told reporters.

Democratic and Republican leaders, who agreed to the package, now must talk to their members and see what changes could make the plan more acceptable, Oberstar added. He blamed the White House for not doing enough to win over Republican votes.

"When you’re voting on painful issues of this kind the generally agreed upon principle is both parties share the pain," Oberstar said.

Oberstar, dean of Minnesota's congressional delegation, said he understands that Peterson and Walz had "very genuine, very real" concerns about the package.

"The bill we voted on today passes the buck when it comes to recouping the losses taxpayers might suffer," Walz said. "I also regret that this bill does not do enough to help average homeowners, or provide sufficient oversight of Wall Street."

Peterson talked to some members of his Agriculture Committee, known as the House's most bipartisan panel, to find a solution to the impasse.

While some congressmen say changes made to Treasury Secretary Henry Paulson’s original bill improved the plan, Peterson said the Monday version was just "Paulson's plan with a few fig leaves."

Kline said the bill was not perfect but was the best possible given the circumstances.

“I just believe that we had negotiated this bill under an enormous amount of pressure because almost all of us have become convinced that there is a financial crisis out there that goes way beyond Wall Street and is going to affect us in the main streets of Minnesota and across the country,” he said.

About two-thirds of House Republicans opposed the bill. Among the changes some Republicans wants, Kline said, is greater use of an alternative approach to the bad assets, in which the securities would be insured by the government at the expense of Wall Street, not the public. That would put more burden on Wall Street instead of taxpayers.

Negotiators must worry about listening to both sides, Kline said.

“As you make it more attractive for Republicans, you’re probably making it less attractive for many Democrats, so this is not easy,” he said. “It has not been easy all week and it’s not getting easier.”

Voters in Kline’s district south and southeast of the Twin Cities overwhelmingly opposed a Wall Street bailout, he said.

“They had some specific concerns and fundamentally they didn’t want to be bailing out rich people on Wall Street and having them walk away with the money and the average guy in Minnesota and across the country picking up the tab,” Kline said.

Only potential legislation providing amnesty for illegal aliens stirred constituents’ interest the way the bailout package did, he said.

“That lit up the phones like crazy. This is on that order of magnitude,” Kline said.

State Capitol reporter Scott Wente contributed to this story.

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