The 52-42 vote falls well short of the 60 votes needed to defeat a Republican filibuster, although the White House said that it would have vetoed the bill anyway, claiming that the measure would not work and costs too much.
But it was a small show of unity by a Republican Party that has been split in recent days as they try to broker a deal with Democrats to help a flailing Wall Street.
President Bush was still scrambling on Friday to unite his own party in order to pass a bailout plan. He told Congress it must “rise to the occasion” and pass the legislation to bail out the struggling financial system.
In a brief statement outside the Oval Office of the White House, Bush said that while members of Congress had every right to express their doubts and frustrations about the proposed $700 billion bailout, he said they must work together to avert an economic meltdown.
“There are disagreements over aspects of the rescue plan,” he said, “but there is no disagreement that something substantial must be done. We are going to get a package passed.”
While Democrats are usually the ones criticizing the White House, it was House Republicans who earlier boycotted bargaining on an emergency bipartisan agreement, saying that it was unacceptable.
House Minority Leader Rep. John Boehner of Ohio sent a letter to House Speaker Nancy Pelosi of California demanding that “serious considerations” be given to the proposal that Republicans had submitted. Their drastically different proposal would not supply government money up front for a financial rescue.
Boehner wrote that the GOP alternative, which proposes tax cuts and an insurance program for mortgage-backed securities to help free up frozen capital, must be given “serious consideration” by congressional negotiators, Reuters reported.
Negotiators had been close to reaching an agreement with U.S. Treasury Secretary Henry Paulson on Thursday, but negotiations faltered in the face of strong opposition from House Republicans who offered their own proposal.
“If such consideration is not given, a large majority of Republicans cannot — and will not — support” the administration’s plan, Boehner wrote.
Rep. Paul Ryan, R-Wis., a chief sponsor of the new House Republican bill, said it was clear that the president’s plan “was not going to pass the House.”
House Financial Services Chairman Barney Frank earlier said that an agreement on the bailout plan would depend on the president to deliver the House Republicans. He called on Republicans to drop “this revolt” against the Bush plan.
“We need to get the president to get the Republican House in order,” said Sen. Charles Schumer, D-N.Y., from the Senate floor. “Without Republican cooperation, we cannot pass this bill.”
The fact that the president’s own party was actively working against his plan illustrates how nervous Republicans are over that his steep disapproval ratings might damage the run of Republican presidential candidate Sen. John McCain.
While McCain said on Wednesday that he was suspending his campaign and returning to Washington to help broker a deal, his campaign on Friday announced that he would in fact be meeting Democrat Barack Obama in Mississippi for the first presidential debate, hosted by The NewsHour’s Jim Lehrer.
McCain left the capital Friday morning after speaking briefly with Boehner about the bailout conflict.
Democrats said they remained confident that they could find a way to pass the legislation.
“We are going to get this done, and stay in session as long as it takes to get it done,” said Sen. Harry Reid, D-Nev., the majority leader.
While President Bush usually does not inject himself personally into congressional lobbying, he was said to be working the phones in an attempt to bring House Republicans back to the table and to find some way to inject their plan into the final legislation.
Vice President Dick Cheney, who is particularly close with the most conservative Republicans, canceled a planned trip to keep in telephone contact with GOP members on the Hill.
The White House had called a summit meeting in order to try to seal the deal that Bush and his administration has argued is essential to balance the nervous markets and assure Americans that the economy is safe. But Bush’s own party refused to support a plan, which appeared it could be accepted by the Senate and most House Democrats.
Paulson at one point dropped to a knee in a teasing way, according to a witness, to beg Democrats not to reveal how bad the meeting had gone. Late Thursday night when Paulson tried to reconvene meetings the House Republicans refused to send a negotiator.
“This is the president’s own party” said Frank to the Associated Press. “I don’t think a president has been repudiated so strongly by the congressional wing of this own party in a long time.”