News & Current Affairs

October 1, 2008

Senate urged to back crisis bill

Senate urged to back crisis bill

Wall Street, file pic

Shares remain volatile ahead of Wednesday’s key vote

Democratic and Republican Senate leaders have appealed for a new version of a $700bn (£380bn) Wall Street bail-out to be approved in a key vote.

Republican Mitch McConnell said it would shield Americans from “shockwaves of a problem they didn’t create”.

The plan needs support in the Senate and House of Representatives, which rejected a similar bill on Monday.

Senate Democrat Harry Reid said he hoped a strong show of bipartisanship would “spark the House to do the same”.

President George W Bush has been speaking to senators ahead of the vote. The White House said it hoped to see “strong support for the bill”.

“It’s critically important that we approve legislation this week and limit further damage to our economy,” said spokesman Tony Fratto.

US presidential hopefuls John McCain and Barack Obama are returning from the campaign trail for the vote, which is due to begin late on Wednesday.

Revised proposal

Global shares were mixed in Wednesday trading ahead of the vote.

By early afternoon on Wall Street the Dow Jones was down 0.2% or 30 points.

CHANGES TO BILL
Raises government’s guarantee on savings from $100,000 to $250,000
Tax breaks to help small businesses and promote renewable energy
Expansion of child tax credit and help for victims of recent hurricanes

But hopes that enough changes had been made to get the bill through saw shares close up strongly in Asia on Wednesday.

In Europe, the UK’s FTSE 100 finished 1.1% higher at 4,959.6 points, France’s key index added 0.6% while German shares fell.

Changes to the rescue plan involve lifting the US government’s guarantee on savings from $100,000 to $250,000 and a package of targeted tax breaks.

They are designed to answer critics who felt the original plan was weighted too much in favour of Wall Street while not enough was being done to help struggling American families.

To get through the Senate, the bill will require backing by 60 of the 100 senators. It would then return to the House of Representatives for a vote on Thursday or Friday.

Some members of Congress continue to press for more fundamental changes to the bill.

President Bush has warned of “painful and lasting” consequences for the US should Congress fail to agree a rescue plan.

The House’s rejection of the earlier version of the plan on Monday led to sharp falls on world stock markets.

In other developments:

  • The European Union outlines its own proposals for reforming banking regulation which, if approved, could see dramatic changes to the way in which banks operate
  • Russian Prime Minister Vladimir Putin says the “irresponsibility” of the US financial system is to blame for the crisis
  • Ireland’s government discusses a move to guarantee all bank deposits with the EU Competition Commissioner

‘Painful recession’

In election campaigning on the eve of the vote, Mr McCain and Mr Obama urged politicians of both parties to work together to pass the emergency legislation.

Speaking in Reno, Nevada, Mr Obama warned that without action by Congress “millions of jobs could be lost, a long and painful recession could follow”.

John McCain campaigns in Iowa, 30 Sept

John McCain said inaction by Congress was putting the US at risk

He added: “There will be a time to punish those who set this fire, but now is the moment for us to come together and put the fire out.”

Mr McCain, who campaigned in Des Moines, Iowa, said inaction by Congress had “put every American and the entire economy at the gravest risk” and that Washington urgently needed to show leadership.

“I am disappointed at the lack of resolve and bipartisan goodwill among members of both parties to fix this problem,” he said.

The vote comes a day before a TV debate between vice-presidential candidates Joe Biden and Sarah Palin.

Mr Biden, Mr Obama’s running mate, is also expected to take part in the Senate vote.

Meanwhile, ex-President Bill Clinton is to hold his first rally for Mr Obama.

Mr Clinton, whose wife Hillary lost to Mr Obama in a fierce primary contest for the Democratic nomination, is due to appear in Florida, where he will encourage people to register as voters before a deadline on Monday.

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September 8, 2008

White House race enters high gear

White House race enters high gear

Barack Obama and John McCain, 5 September 2008

Candidates often see a surge in popularity after the party conventions

The US presidential rivals have begun campaigning in earnest, as a new opinion poll put Republican John McCain ahead of Democrat Barack Obama.

Fresh from being nominated at their party conventions, the two men are now gearing up for the 4 November poll.

A USA Today-Gallup poll put Mr McCain ahead for the first time in months.

Candidates often see a bounce in the polls after the conventions but Mr McCain’s choice of Sarah Palin as running mate is being seen as key.

Mr McCain has tried to strike a balance between distancing himself from an unpopular presidency and rallying the party’s conservative base.

Mrs Palin wowed the Republican convention crowd with her speech, helping to re-energize his campaign.

Major test

Mr McCain said that “the electricity has been incredible” at rallies ever since he invited the Alaskan governor to join his ticket.

“She has excited people all over the country. I would love to say it was all because of the charisma of John McCain, but it is not,” he told CBS on Sunday.

Sarah Palin and John McCain (6 September)

Mr McCain said that “the electricity has been incredible” at rallies

Mrs Palin will face a major test this week when she gives her first nationally televised interview, following intense media scrutiny over her personal life and credentials for the ticket.

The USA Today-Gallup poll, which was released on Sunday, showed Mr McCain leading Mr Obama by four percentage points, 50 to 46.

A USA Today poll taken before the Republican convention showed Mr McCain trailing Mr Obama by seven points.

The latest poll had a margin of error of plus or minus three percentage points.

The results of a Reuters/Zogby poll, also released over the weekend, gave Mr McCain the edge, with 50 percentage points to 46.

The Rasmussen Reports daily Presidential Tracking Poll showed John McCain with a one-point lead.

Mr McCain and Mrs Palin are scheduled to be in Missouri on Monday.

Mr Obama is campaigning in the crucial swing state of Michigan. His vice-president, Joe Biden, was appearing in Wisconsin and Iowa, while Hillary Clinton is on the campaign trail in Florida.

Despite the frenetic pace of the presidential race, the candidates will stop campaigning on Thursday to appear together in New York on the anniversary of the 11 September 2001 attacks.

They said they would put aside politics to honour the memory of the nearly 3,000 people who died.

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