Bush's bailout plan rejected

• Lawmakers voting against bailout cite flaws in plan
• Dow posts record plunge after US Congress votes against bailout
• Oil prices plunge over economic downturn fears after bailout rejection

The House of Representatives has rejected by a vote of 228 to 205, bipartisan legislation to authorize a $700 billion bailout for U.S. financial markets. Opponents said the massive government intervention failed to address fundamental market problems and contained too few protections for American taxpayers. VOA's Dan Robinson reports on the House vote, which caused U.S. financial markets to plunge.

When the final vote was announced, the measure went down to defeat, with 132 Republicans and 94 Democrats rejecting appeals from their party leadership to support the legislation.

Facing one of the most difficult votes they have ever taken, Democrats and Republicans voiced support or opposition to the legislation during a three-hour debate.

Main elements include authorization for the government to purchase troubled assets and acquire equity in threatened financial firms; creation of a strong oversight board; steps to help Americans avoid loss of their homes; and limits on executive compensation.

Under the plan, Congress would make $250 billion available immediately, followed by $100 billion on an additional certification of need, and another $350 billion subject to a congressional vote.

"We regret being here because we all deeply regret the econ conditions, which have made this decision day necessary," said Barney Frank. "No one is happy that we have seen the failure that we have seen in our economic system," said House Financial Services Committee Chairman Barney Frank.

Republican minority leader John Boehner acknowledged the difficulty many in his party had in voting for the legislation.

"We have cast a lot of tough votes along the way," said John Boehner. "I do not know that they get much tougher than this. Because nobody wants to vote for this, nobody wants to be anywhere around it, and I do not blame you, I do not want to be around it."

Many Republicans called the measure corporate welfare, asserting it will not have the desired effect on financial markets and saddle Americans with more debt in the long-run.

Texas Republican Representative Jeb Hensarling and Mike Pence of Indiana:

HENSARLING: "I fear this legislation is fraught with unintended consequences. I fear that ultimately it may not work. I fear it is too much bailout and not enough work out. I fear that taxpayers may end up inheriting the mother of all debts."

PENCE: "It remains in my judgment the largest corporate bailout in American corporate history, forever changes the relationships between government and the financial sector and passes the cost along to the American people and I cannot support it."

House Speaker Nancy Pelosi tried to assure lawmakers that a yes vote would not be, as she put it, the end of the line, with further congressional actions next year:

"As long as in the households of America, this crisis is being felt very immediately, and being addressed at a different level, we must come back and we will come back as soon and as often as is necessary and to make the change that is necessary," said Nancy Pelosi.

After the vote, a White House statement expressed disappointment with the outcome. Rejection of the legislation by the House throws its fate into question.

-TMB