The Bush administrations capitulation on the unprecedented housing bailout package Wednesday left House Republican leaders and conservatives at a loss.
GOP leaders had been whipping against the bill Tuesday and told reporters they had enough votes to sustain Bushs repeatedly threatened veto, restated yet again as recently as Monday. But then they got the call Tuesday night that the White House was caving.
We got nothing, said one disappointed GOP lawmaker.
The veto threat centered on a Democratic proposal to add a $4 billion fund for local governments to buy foreclosed properties. The administration blamed the urgency of the housing crisis for going back on its veto threats.
We dont think that waiting until mid-September at best would be prudent, said Bush spokeswoman Dana Perino, warning of the risks of a drawn-out veto fight.
But that didnt satisfy Republican lawmakers, who thought Democrats would have compromised before going home for the August recess if Bush had stuck to his guns.
Im deeply disappointed the White House will sign this bill, said House Minority Leader John Boehner (R-Ohio), who ripped it as a multibillion-dollar bailout for scam artists and speculative lenders at the expense of American taxpayers.
Republicans were prepared to back a bailout of Fannie Mae and Freddie Mac, but they objected to Democratic plans for expanding their missions to underwriting larger mortgages, as well as a new tax that would fund an affordable-housing initiative they labeled a slush fund. Conservatives also wanted to limit Fannie Maes and Freddie Macs influence in the future.
The bill passed 272-152, with Republicans maintaining a veto-sustaining minority even after Bush backed down.
Ive regretfully concluded that Fannie and Freddie are clearly too big to fail today, but I will not support a legislative package that will not ensure that we are not back here in one, two or three years, Republican Study Committee Chairman Jeb Hensarling (Texas) said.
I think panic is driving it, said Rep. Paul Ryan (R-Wis.), ranking member on the Budget Committee, referring to the White Houses sudden acquiescence. They are just so concerned about a financial meltdown that theyll take anything.
Ryan said the bailout package was stunning in scope, with an $800 billion debt-limit increase attached, particularly given that the legislation would make it easier for the troubled mortgage giants to expand their reach.
We had an opportunity to rein in [Fannie and Freddie] this week and we missed it, Ryan said. We are giving them a shovel to help them dig deeper.
Ryan blamed Fannie and Freddies political muscle.
Weve got a Congress run by Fannie and Freddie apologists, and we may well have an administration willing to turn a blind eye, which may well lead to a bigger taxpayer bailout in the future.
Rep. Tom Price (R-Ga.) also expressed disappointment in the White House. If the American people want Western European socialism, this is a step in that direction.
Price predicted Members will rue the day they voted for the package.