Late Wednesday, October 1, the U.S. Senate approved a $700 billion government bailout for Wall Street by a vote of 74-24, according to The New York Times.
But for opponents of the bailout bill, the fight to get it passed is far from over.
The bill now heads to the U.S. House of Representatives, which already denied an earlier version on Monday, September 29 and sent world markets tumbling.
President George W. Bush has urged the House to pass the bill by Friday to avoid further financial crisis.
The government -or, rather, taxpayer- bailout plan comes at a time of global financial turmoil, which stems from the collapse of the U.S. housing market combined with reckless Wall Street practices.
Some of the significant amended factors in the updated bill were intended to sweeten the bailout plan for the House and include:
Raising Federal Insurance for Bank Deposits: It raises federal insurance from $100,000 to $250,000 through the FDIC. This is an attempt to calm bank customers fears and hopefully avoid massive bank deposit withdraws, which could collapse the U.S. economy.
Adding Tax Break Extensions: The new bill allows for $110 billion in tax breaks. Here's some of the industries that would benefit from this added provision:
Many of these tax breaks were added to get certain politicians to sign the bill. (For example, two Oregon senators wanted the wooden arrow tax break to help a major manufacturer in their state.) This provision would increase the federal deficit and may sway some House conservatives from voting for the amended plan.
Restricting "Golden Parachutes": The revised bill restricts Wall Street CEOs and executives from receiving huge severance packages. Americans have voiced their anger of having to use taxpayer money to bailout failed institutions while executives walk away with padded severance packages.
Giving the U.S. Treasury Power to Buy U.S. Mortgage Debt: This is essentially the "heart" of the bill. It gives Treasury Secretary Henry Paulson the authority to buy toxic mortgage-related assets from troubled banks. Advocates say the government could eventually sell the devalued assets at a better price. The hope is that it would ease the credit freeze and keep the economy from a deep recession.
Opponents of the bill are especially worried that one man (Henry Paulson) could be placed with so much power over the financial markets.
There is also staunch resistance from voters who view the government bailout as a present to Wall Streeter's who've participated in greedy and irresponsible practices.
Citizens are also understandably disgruntled about the idea that taxpayers would foot the bill.
While Wall Street is financially collapsing, so are many American households who are facing mortgage foreclosure and their own personal financial woes. Many people are seeking to file bankruptcy as a way to find financial relief or save their home from foreclosure.
With every House member facing voters this year in a tight election, it's expected the bill may have a tough time getting approved in the House.
Stay tuned to Total Bankruptcy and the Total Bankruptcy Blog for more information on the U.S. economy, the government bailout plan and the connection to Americans who are filing bankruptcy and falling into foreclosure.
With the economy in such turmoil, many Americans are feeling the crunch. If you are considering filing bankruptcy, consider consulting with one of our sponsoring bankruptcy lawyers: