Tierney switches vote, backs bailout

By Katie Curley
Staff writer

October 03, 2008 10:08 pm

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WASHINGTON — After telling Newburyport business owners Thursday morning that the revised financial bailout package did little to protect Americans, Congressman John Tierney reluctantly voted in favor of the $700 billion economic transfusion yesterday afternoon.

The House approved the bill 263-171. The original bill failed Monday, but yesterday saw the margin of "yes" votes increase by 58.

Underscoring somber warnings about the job market early yesterday, the Dow Jones Industrial Average, up more than 300 points at the time of the House vote, fell into negative territory an hour later. It fluctuated as the afternoon wore on before closing 150 points down.

"As I reluctantly vote in favor of this bill, I do so knowing of the uncertainties involved but with the belief that this is the best of the bad alternatives to pursue and with the determination that Congress will keep fighting to implement the reforms I have been seeking," Tierney said in a written statement released minutes after the vote. "Investigative hearings on the economic crisis are already scheduled next week in the Oversight and Government Reform Committee, on which I serve, and we will continue to help distressed homeowners, safeguard the taxpayer and hold accountable those responsible."

Earlier this week, Tierney, who represents Greater Newburyport, voted against the bill, saying it did not do enough to deal with the economic crisis affecting the nation and was skeptical up until Thursday morning of the revised version.

Tierney opposed it, "because it was flawed and did not adequately address the underlying problem with our financial system. I thought the measure could have mandated more direct assistance and judicial relief for homeowners who find themselves in troubled mortgage situations. Also, more might have been in the bill to 'pay for' the expensive purchase of 'toxic assets' and better ensure our constituents' tax dollars were not at risk. I had hoped that Congress would use the intervening days to restructure the approach."

Tierney went on to say he remains concerned with the legislation and hopes improvements are made to it in the coming days and weeks.

"The state of panic in the markets compels Congress to act, to demonstrate resolve and to attempt to restore whatever confidence we can to our financial system," he wrote. "Although we all know that the Senate added a number of unrelated provisions to garner new votes from former opponents, the primary consideration is about the underlying Emergency Economic Stabilization Act."

At the Newburyport Chamber of Commerce breakfast Thursday morning, Tierney noted the difficulty of deciding which way to vote.

"It's not as simple as saying it's a good or bad bill," Tierney said. "Do you do something temporarily to gain relief for the next several months until the new administration moves in? Or do you spend the $700 billion and be without that money if it doesn't work."

Tierney was skeptical, saying the changes to the bill targeted a select few lawmakers to "buy" their votes.

As part of the new bill, the Senate approved a one-year increase in federal insurance on individual bank deposits from $100,000 to $250,000 to boost consumer confidence in banks and protect small-business owners.

"They are going after 12 votes," Tierney said. "The new bill is over 400 pages and adds things not necessary to the bill to buy votes. A lot of economists agree with me, but the White House doesn't want to lose the votes. They are really only after 12 votes, not mine."

At the Chamber breakfast at the Phoenix Room Thursday, local business owners told Tierney to take back to Washington an understanding of what is at stake. They argued a vote in favor would ensure people's confidence in the economy would rise.

"I am in great agreement with the frustration and even anger felt by individuals and families who behaved properly and played by the rules. From wide ranging discussions with my constituents, small-business owners, regional and local bankers, and retirees it is clear that we are all furious at those investment firms whose incredibly poor judgment, greed and carelessness contributed to this financial mess," he said. " We resent having to rescue them. Unfortunately, the consequences of their actions are increasingly targeted at all of us. I have met and talked to people throughout the district and heard the many ways the credit freeze is affecting their families."

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.

Tierney's opponent for the November election, Richard Baker, R-West Newbury, issued a statement following Tierney's vote saying the six-term congressman "buckled to Washington pressure."

"This vote demonstrates Mr. Tierney's inability to withstand the pressure of Washington insiders," Baker wrote. "Last week, he voted for the people on the North Shore, and this week he is voting for the special interests in Washington. We need a congressman who has the courage to stand up for what is right regardless of the pressure. Mr. Tierney has failed this test."

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