In a sense, congressman Roy Blunt, who House Republican leader John Boehner tapped this morning as chief negotiator on the Wall Street bailout, seems an obvious choice. As the Republican whip, Blunt is the number two Republican in the House and Boehner's top deputy.
The move has surprised many in Washington, however. Blunt is not regarded as a particularly effective whip or as a specialist in economics. The GOP resistance to the bailout has been led by Virginia congressman Eric Cantor, who many on Capitol Hill regard as the natural choice to take the lead in the negotiations. Cantor is close to Boehner and has ties to conservative backbenchers. He's well-regarded by colleagues on economics issues.
Cantor crafted the Republican alternative to the bailout, calling for the federal government to Wall offer insurance on mortgage-backed securities to Wall Street firms. Democrats and Treasury officials are said to have scoffed at the new proposal, which they regard as a "last minute" surprise. This morning, however, the Republican leadership continued to push the proposal with a letter from Boehner (see below) to House Speaker Nancy Pelosi. Polls showing that only 30% of voters support the bailout seem to have strengthened Republican resolve on the bailout issue.
Washington insiders were divided on what the decision to send Blunt to the negotiating table meant. One former House leadership staffer believes it signals a surrender of Republican resistance. Another longtime observer of Capitol Hill politics disagreed, saying the Blunt could be sent to give the impression that Republicans were cooperating and trying to reach a solution without actually committing the Republicans to action on the bailout. The editor of National Review, Rich Lowry, reports that the collapse of Washington Mutual and the "swoon" of Wachovia may have Republicans fearing they could be blamed for a broad financial collapse.
"A source in the middle of all this detected a change in mood among House Republican over night, after WaMu's collapse and Wachovia's swoon and with the prospect of being blamed for a financial collapse looming. This source also understands the constituent calls are beginning to turn a little—people now are beginning to get scared," Lowry says.
The Honorable Nancy Pelosi
Speaker of the House
H-232, U.S. Capitol
Washington, D.C. 20515
Madame Speaker
As our discussion ended last night, we agreed to continue talking about how to best solve this economic crisis. Like you, House Republicans and I believe we must address this crisis quickly and in a way that protects the interests of families, seniors, small businesses, and all taxpayers. As you know, this process is not about faceless executives on Wall Street, but about keeping families in their homes, safeguarding their retirement security, college savings, and bank accounts, and protecting their jobs.
Over the last week, we have frequently discussed Secretary Paulson's proposal, and I have repeatedly expressed the need for improvements on behalf of myself and my Republican colleagues. Our staffs have also been in regular contact. To that end, Financial Services Committee Ranking Member Spencer Bachus (R-AL) was tasked by House Republicans to engage in discussions with Chairman Barney Frank (D-MA) and Chairman Chris Dodd (D-CT) and report back to our Conference on the progress of those negotiations before a final deal could be made. Yet Chairman Frank and Chairman Dodd, on several occasions over the last several days, announced that a bipartisan deal was at hand even though the reservations about the underlying proposal I had expressed to you had not been addressed. Each time such announcements were made, or even rumored, I or my staff made it clear to media and to your staff that any such deal did not include House Republicans.
As we demonstrated at the beginning of this year when we crafted a timely agreement on the economic stimulus package, a bipartisan response to our nation's priorities is never out of reach. And I believe the same holds true at this hour. House Republicans are prepared to stay in Washington to forge an agreement on a proposal that reflects the core free-market, pro-taxpayer principles of our Party.
With that in mind, earlier this week, with your knowledge, I directed our Chief Deputy Whip Eric Cantor (R-VA) to lead a working group of House Republicans to develop a package of ideas to move this process forward. His working group represented a broad cross-section of House Republicans – including both moderate and conservative members – and their goal was to develop ideas worthy of support on both sides of the aisle. We have discussed some of these ideas, and I would like to reiterate that I believe they should be given the consideration they deserve as our economic rescue discussions continue. A brief overview of the working group's blueprint is included with this letter.
Madam Speaker, we owe it to all those with a stake in this process to continue our discussions until we arrive at an agreement that is acceptable on both sides of the aisle – and more importantly, one that serves the interests of American taxpayers. That is why I ask you and your Democratic colleagues to give the House Republican working group's proposals serious consideration as this process moves forward. If such consideration is not given, a large majority of Republicans cannot – and will not – support Sec. Paulson's plan. In the interest of the men and women we represent in Congress, I hope it does not come to that conclusion. I look forward to your timely response and to continuing our work together on an economic rescue package worthy of all of our support.
Sincerely,
John Boehner
Republican Leader
