THE ECONOMY:

Berkley to make U-turn on bailout

Democrat voted against it Monday, says she will back goodies-laden rewrite

Friday, Oct. 3, 2008 | 2 a.m.

Washington — Democratic Rep. Shelley Berkley never expected to be one of the critical votes on the $700 billion bailout bill.

After voting against it Monday, she left the House floor early to catch a plane home. Rep. Rahm Emanuel, the Illinois Democrat who had been central to negotiations, ran after her.

Call me if you need me to U-turn back to the chamber, she told him. “I would not be the vote to submarine the bill,” she said she told him.

The bill fell 12 votes short, in a defeat that stunned Washington and Wall Street.

Berkley said Thursday she will vote yes when the bill comes up for a new vote, probably today.

The Las Vegas congresswoman said the seriousness of the nation’s financial troubles and the new bill’s extension of popular tax breaks persuaded her to drop her opposition.

“It’s been an eye opening few days,” Berkley said. “I hate this like poison, but I think relief is necessary.”

For Berkley and the other Nevada lawmaker who voted against the bailout, Rep. Dean Heller of Carson City, the stakes grew higher when the new bill passed by Senate included many sweeteners that are important for the state. (Republican Rep. Jon Porter was among 65 in his party to vote yes on Monday, and he plans to do so again.)

The bailout provisions mainly remain, but the new package includes the hugely popular extensions of expiring tax credits that need to be renewed before year-end or businesses and residents would unknowingly be hit with new taxes.

Nevada Republican Rep. Dean Heller also voted against the bill on Monday, saying that it bordered on socialism. His office declined to discuss the congressman’s position now as the do-over nears.

One provision added to the bill is particularly important in the rural parts of Heller’s district — extension of the federal payments in lieu of taxes. Rural counties rely on these funds because so much of their land is owned by the federal government and unavailable for economic development.

Among the other sweeteners that motivated Berkley is exemption from the alternative minimum tax, which would snare 138,000 middle-class Nevadans with that tax if it were not renewed.

There is also a provision that allows residents in states such as Nevada that have no state income tax to deduct state and local sales taxes on their federal returns.

For businesses, the bill includes the renewable energy tax credits that have been the No. 1 lobbying issue for solar, wind and geothermal companies. Berkley said Nevada is ripe for green energy investments, but companies say that without tax breaks, they will have to close up and eliminate jobs.

Small-business owners would continue to get tax breaks for opening restaurants. Film companies would get continued breaks for producing movies and television shows domestically.

Closer to kitchen table politics, the bill includes a child income tax credit, a $1,000 homeowner deduction for families that don’t itemize their deductions and a credit to reimburse teachers $250 for out-of-pocket spending for school supplies.

It’s a package that is tough for lawmakers to refuse.

The House and Senate were at odds over the tax extension package for months, because some House Democrats believe it must be fully paid for — which means new taxes that Republicans generally oppose.

By putting it on the bailout bill, Senate Majority Leader Harry Reid saw a chance to both win Republican bailout votes and pass the deadlocked tax package.

Berkley said Democratic leadership has not been arm-twisting to get her to change her vote. She has had just one call from a fellow lawmaker asking her thoughts.

Reid did not call her, saying he had his hands full in the Senate and “she doesn’t need me talking to her.”

Republicans are under greater pressure to produce votes. Their members voted against the bill 2-to-1 on Monday in what was expected to be a bipartisan compromise.

Heller’s office declined to discuss whether he had received calls from the White House or Republican presidential candidate John McCain, as other lawmakers have.

Heller had staunchly opposed the bailout, and was not among those being mentioned by Republicans as a lawmaker who might switch.

Discussion: 8 comments so far…

By jfnance32

10/3/08 at 4:20 a.m.

Suggest removal

What Obama did not call her?

I guess he even did not phone it in this time.

Perhaps he mailed it in.
By johnevegas

10/3/08 at 6:06 a.m.

Suggest removal

"I guess he even did not phone it in this time."

Nice grammar. Did you get that parts from Faux News too?
By mschaffer

10/3/08 at 6:28 a.m.

Suggest removal

Jimmy, Jimmy, Jimmy,

From CBS news:
Even though his campaign is no longer suspended, John McCain is staying in Washington this weekend to keep working on the bailout legislation. He will not be visiting Capitol Hill, however, preferring to work out of his campaign office.

"He can effectively do what he needs to do by phone," said senior adviser Mark Salter. "He's calling members on both sides, talking to people in the administration, helping out as he can."
By jfnance32

10/3/08 at 6:43 a.m.

Suggest removal

"She has had just one call from a fellow lawmaker asking her thoughts."

No Obama??????
By neiman1

10/3/08 at 7:11 a.m.

Suggest removal

I am against it unless you need my vote for it. I have an election at home where the voters don't like it so let me vote no as long as it will pass anyhow. This isn't change, this is Obama and company's more of the same.
By term2

10/3/08 at 8:21 a.m.

Suggest removal

They are being quiet about the SEC changing its stand on valuation of mortgage assets. They are allowing banks to count the full value of a mortgage on its books, EVEN THOUGH THE MORTGAGE ISNT WORTH THAT MUCH ANYMORE.

This is just delaying the inevitable. So what is this 700b for ? I suspect there will be additional requests for money in a few months.

What a government caused debacle.
By KDR81

10/3/08 at 8:32 a.m.

Suggest removal

Booo
By texexnv

10/3/08 at 10:02 a.m.

Suggest removal

Hmmm...I thought she was of the faith that didn't eat the genus "Sus domestica". http://wiki.answers.com/Q/What_is_the_ge...

Guess if you smear enough pork fat on it, she'll eat anything.