Lawmakers Get Down to Details of Drafting Bill

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Bush on Bailout: 'We Will Rise to the Occasion'

President Bush said, "We are going to get a package passed," referring to the economic bailout plan during a brief statement from the White House on Friday morning.

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· A proposal to dole out the money in segments, with Paulson getting $250 billion immediately, another $100 billion later and the final $350 billion after giving Congress 30 days to object.

· A plan to help taxpayers recover their investment by granting them equity in companies that participate in the bailout and return to profitability.

· A provision that would require the Treasury to ban "excessive and inappropriate" compensation for top executives at participating firms. Democrats are also seeking to eliminate a tax deduction companies take for executive compensation if a senior manager is paid more than $400,000 a year.

Republican negotiators, meanwhile, appeared to be most concerned yesterday about a Democratic proposal to dedicate a portion of any profits from the eventual sale of the assets to an affordable housing fund. Republicans argue that the fund would benefit social service organizations with strong ties to the Democratic party.

Lawmakers from both parties reached an agreement in principle on the bailout plan around lunchtime Thursday. But that deal was imperiled hours later, after a White House summit that included Bush and both presidential candidates turned into a shouting match. House Minority Leader John A. Boehner (R-Ohio) angered Democrats by floating the insurance idea, then refusing to participate in a late-night negotiating session with Paulson.

Yesterday got off to a much better start, as House Minority Whip Roy Blunt (R-Mo.) announced that he would join the negotiations. A member of GOP leadership for six years, Blunt enjoys a comfortable relationship with some Democrats and played the lead role in several recent bipartisan negotiations, including a compromise on foreign intelligence surveillance legislation.

Meanwhile, Rep. Eric Cantor (R-Va.), a key figure in a band of Republicans that had adamantly opposed the bailout plan, softened his opposition. Cantor acknowledged that, in dealing with the most troubled mortgage securities, the insurance model preferred by many Republicans would not be sufficient because the securities already had minimal value. "So you've got to go with Paulson's model," Cantor said.

Including an option for mortgage insurance might persuade more Republicans to support the bailout plan, Cantor said. Boehner concurred, saying the entire deal could collapse unless the idea were given serious consideration.

Without it, "a large majority of Republicans cannot -- and will not -- support Secretary Paulson's plan," Boehner wrote in a letter to Pelosi yesterday.

Democrats said they don't think insuring mortgages would solve the credit crisis, because the Republican plan proposes to charge premiums to the very banks that are struggling to stay afloat. They sad the idea also would make the government the insurer of last resort, exposing it to losses that could exceed the price of the Bush proposal.