Peter Welch votes for crisis plan

By SUSAN ALLEN Times Argus Editor
October 4, 2008

Although he considered it "deeply flawed," U.S. Rep. Peter Welch was among 263 members who voted Friday afternoon to pass a roughly $700 billion bill designed to bail out the financial industry and ease the economic crisis sapping the national economy.

"Passing this plan, imperfect as it may be, protects taxpayers and gives us our best chance at stabilizing the economy and protecting the jobs, savings, and retirement accounts of hard-working Vermonters," Welch said in a statement shortly after the vote.

"This is a bitter pill to swallow, especially for thrifty and responsible Vermonters," he added. "It is my judgment, however, that a failure to act would further aggravate economic instability for working Vermonters and businesses."

The measure won't instantly solve the nation's economic problems, Welch said. "There is no quick fix."

Earlier in the day, Welch explained his thinking to reporters during a noontime conference call, just one hour before the start of the vote on the House floor. Welch last Monday had voted against the bailout measure, which failed to pass 228-205, sending the stock market to a record decline of 777 points.

"We're at the point we have to choose. It's this bill or no bill — no bill is an absolute catastrophe," he said. "I've been hearing from Vermonters who are rightly furious that our economy has come to this point. We in Vermont borrow and spend within our means. Vermonters did not cause this problem."

That being said, he added, Vermonters and local businesses are at risk of "being caught in the undertow" of this economic meltdown unless Congress steps in to relieve the crisis.

"I intend to vote yes on this economic package as the best choice that is available to us at this moment," he said.

Welch said he voted no on the earlier proposal because the bill failed to meet his two standards: It must protect Vermont jobs and security; and it must protect Vermont and American taxpayers.

The Senate's version, which was approved Wednesday, was closer to meeting his priorities, he said.

Included in the Senate measure were increases in FDIC insurance to prevent runs on banks that threaten depositors and banks alike, an Securities and Exchange Commission accounting change that should stabilize the values of homes even in dismal markets, and assurances from U.S. Sen. Barack Obama, the Democratic candidate for president, that if elected in November he would push for the financial services industry to shoulder the costs of the changes, not taxpayers.

"Senator Obama gave me his personal assurance – and let me be clear, I trust Senator Obama – as the next president he would fight for a 'recoupment' fund to make certain the cost of this program would be borne by the financial services community and not the taxpayers," Welch said of a telephone call he held with Obama earlier this week.

Welch conceded that the bill had picked up a lot of add-ons in the Senate, not all of them to his liking. Most involved changes in tax policy designed to woo support for the measure from various lawmakers, such as a $10 million tax break for small television and film producers added to win the backing of a Los Angeles congressman.

"My personal preference is we keep these bills spare and clean," Welch said. "The Senate added some of its tax provisions that frankly I wish they hadn't."

The final vote on Friday was 263-171.

"I share the outrage of Vermonters. It's outrageous that Wall Street created this," he said. "I share the fury. But what I also heard from Vermonters was a certain fear of the consequences of inaction."