Congress, the White House Stall Over Market Rescue Plan

The centerpiece is to have the federal government buy up to $700 billion of compromised mortgage-backed assets from ailing financial firms. But the plan ran into fierce resistance from the public and lawmakers and has been undergoing reworking, including adding strong oversight of the Treasury Department's process of buying the debt.

When the members of Congress emerged from the meeting, they pronounced they had the framework of a final deal, but no specifics.

Senate Banking Chairman Christopher Dodd of Connecticut.

SEN. CHRIS DODD (D), Connecticut: We've reached a fundamental agreement on a set of principles, one, for taxpayers, which is tremendously important. We're giving the secretary authority that he will need in order to act and the funding that he will need.

We also have dealt, I think, effectively with the issue of effective oversight, with home ownership preservation, as well as executive compensation.

KWAME HOLMAN: Republican Robert Bennett of Utah also sits on the Banking Committee.

SEN. ROBERT BENNETT (R), Utah: The most encouraging thing that comes out of it, from my point of view, is that I now expect we will, indeed, have a plan that can pass the House, pass the Senate, be signed by the president, and bring a sense of certainty to this crisis that is still roiling in the markets. That is our primary responsibility, and I think we're now prepared to meet it.

REP. BARNEY FRANK (D), Massachusetts: We did talk in there very seriously about the specifics, and we came to some agreement on a lot of the important issues.

And, yes, we are on track, I believe, to pass this. The market should be calmed down.

We should note that some of us have been invited to go to the White House today to try to break a deadlock, and I'm glad that we'll be able to go and tell them that there really is not much of a deadlock to break. But I'm always glad to get to go to the White House.

KWAME HOLMAN: Alabaman Spencer Bachus is the top Republican on Frank's committee.

REP. SPENCER BACHUS (R), Alabama: One thing that I'm encouraged by is something that Sen. Reid and I have worked on for taxpayer protection, to see that the taxpayer and that the Treasury is reimbursed for their expenditures.

And I think that was an important step that we all took, and we're committed to the tax money -- the taxpayer being protected.

There was progress today. And I felt like the discussions were very open and we're all committed to a successful and positive conclusion.

And their leader, John Boehner of Ohio, released a statement saying, "House Republicans have not agreed to any plan at this point."

Boehner was echoed by Sen. Richard Shelby of Alabama, the top Republican on the Banking Committee, who spoke after the big meeting at the White House.

SEN. RICHARD SHELBY (R), Alabama: I can tell you, I don't believe we have an agreement. I have voiced my concerns all along.

I don't know if you have this, but I have a five-page -- five pages of the leading economists in America that wrote to me and the leadership saying the Paulson plan is a bad plan, it will not solve problems, it will create more problems, we're rushing to judgment, that we do have stress in our financial markets, but this is not the best way we ought to look at alternatives.

KWAME HOLMAN: Members then traveled back up Pennsylvania Avenue for more discussions at the Capitol.