Wamp switches to yes vote on bailout plan

By Bill Theobald, Gannett News Service

Chattanooga Republican Rep. Zach Wamp voted for a revised plan to bail out the nation's financial institutions Friday, the only Tennessee House member to switch his vote on the proposal.

But Wamp had plenty of company. The House, which voted 228-205 to reject the plan Monday, voted 263-171 to pass it Friday.

President Bush immediately signed the bill.

"I voted against a bad bailout bill on Monday, and will now vote for a better rescue plan, not because I like it or want to but because we fought as hard as we could for more reforms," Wamp said before his vote.

The changes in the bill since Monday include increasing from $100,000 to $250,000 the amount of bank deposits covered by the Federal Deposit Insurance Corporation.

The Senate's revised version of the proposal initially rejected in the House also added two tax breaks important to Tennesseans: an adjustment of the Alternative Minimum Tax and an extension of the deduction of sales tax on federal tax returns.
Without the AMT fix, the number of Tennesseans affected by the tax would have jumped from 25,191 to 316,048. The AMT originally was intended to make sure the wealthy paid some taxes, but it has come to affect middle-class taxpayers as well, which the fix is designed to avoid.

The sales tax deduction saves Tennessee families several hundred dollars on average.

The core of the original plan - allowing the Treasury secretary to buy up to $700 billion in bad mortgages and mortgage-backed securities as a way to free up credit for families and businesses - remained unchanged.

But the additions made by the Senate didn't change the no vote of Rep. Marsha Blackburn, R-Brentwood.

"I simply could not vote to inflate the federal debt without cutting a single dollar in federal spending in good conscience," Blackburn said in a written statement. "I believe that Wall Street has gotten away with armed robbery. I am skeptical that this bailout will be the great salvation the administration told us it would be."

Spending cuts were never a serious part of any discussion about a rescue plan.

Other Tennessee House members voting for the revised plan were Democratic Reps. Jim Cooper of Nashville, Bart Gordon of Murfreesboro, John Tanner of Union City, and Steve Cohen of Memphis.

Others voting against the bill were Democratic Rep. Lincoln Davis of Pall Mall and Republican Reps. John Duncan of Knoxville and David Davis of Johnson City.