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Washington: With the economy on the brink and elections looming, Congress approved an unprecedented $700 billion government bailout of the battered financial industry on Friday and sent it to President Bush for his certain signature.
The final vote was 263-171 in the House, a comfortable margin that was 58 more votes than the measure garnered in Monday's stunning defeat. The vote capped two weeks of tumult in Congress and on Wall Street, punctuated by daily warnings that the country confronted the gravest economic crisis since the Great Depression if lawmakers failed to act.
President Bush later signed the landmark legislation to help lenders unload distressed real estate assets off their books, a move aimed at curbing a spreading financial crisis.
The White House confirmed that Bush had signed the bill, just before he was due to leave for a political fund-raiser in St. Louis and a weekend stay at his Texas ranch.
The economy remains in peril, and much more needs to be done, warned everyone involved, from Bush on down.
Underscoring that somber message, the Dow Jones industrials, up more than 200 points at the time of the House vote, had fallen into negative territory an hour later. They fluctuated as the afternoon wore on.
At the White House, Bush declared, "We have acted boldly to help prevent the crisis on Wall Street from becoming a crisis in communities across our country."
Treasury Secretary Henry Paulson pledged quick action to get the program up and operating.
"We all know that we are in the midst of a financial crisis," House Republican Leader John Boehner of Ohio, said shortly before casting his vote for government intervention in private capital markets that was unthinkable only a month ago.
"And we know that if we do nothing, this crisis is likely to worsen and to put us into an economic slump like most of us have never seen."
Speaker Nancy Pelosi, Democrat-California, said the bill was needed to "Begin to shape the financial stability of our country and the economic security of our people."
Wall Street welcomed the action, but investors also were buffeted by a bad report on the job market. The Labor Department said employers slashed 159,000 jobs in September, the largest cut in five years and further evidence of a sinking economy.
Federal Reserve Chairman Ben Bernanke, who had joined the administration in urging quick action, said, "The legislation is a critical step toward stabilizing our financial markets and ensuring an uninterrupted flow of credit to households and businesses." He said the Fed would work closely with the Treasury Department to put the bill's provisions into effect.
Even before the measure cleared Congress, the White House sought to dampen optimism of its immediate impact on the economy. "This legislation is to fix a problem in our financial markets," said spokesman Tony Fratto. "It's not sold as giving a boost to the economy, but rather preventing a crisis in our economy... If it works as we hope it will, credit will be able to begin flowing again."
The House vote marked a sharp change from Monday, when an earlier measure was sent down to defeat, largely at the hands of angry conservative Republicans.
Senate leaders quickly took custody of the measure, adding on $110 billion in tax and spending provisions designed to attract additional support, then grafting on legislation mandating broader mental health coverage in the insurance industry.
The revised measure won Senate approval Wednesday night, 74-25, setting up a furious round of lobbying in the House as the administration, congressional leaders, the major party presidential candidates and outside groups joined forces behind the measure.
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