G.O.P. Resistance May Delay Housing Legislation - NYTimes.com

G.O.P. Resistance May Delay Housing Legislation - NYTimes.com: "G.O.P. Resistance May Delay Housing Legislation

G.O.P. Resistance May Delay Housing Legislation

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By DAVID M. HERSZENHORN
Published: July 16, 2008

WASHINGTON — Democratic Congressional leaders on Tuesday pushed back their timetable for approving emergency housing legislation after Republicans voiced growing skepticism and, in some cases, angry opposition to the Bush administration’s proposal to rescue Fannie Mae and Freddie Mac, the government-chartered mortgage finance companies.
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Republican lawmakers — including the House minority leader, Representative John A. Boehner of Ohio; the party whip, Representative Roy Blunt of Missouri; and the senior Republican on the House Financial Services Committee, Spencer Bachus of Alabama — all urged Democrats to take more time to go over the administration’s proposal, including committee hearings and a chance for lawmakers to offer amendments to any legislation.

“The sweeping changes contemplated in the proposal made by the Treasury Department over the weekend represent a far-reaching overhaul of the financial regulatory structure of our housing market,” Mr. Bachus wrote in a letter to Representative Barney Frank, the Massachusetts Democrat who is the chairman of the Financial Services Committee and is a main author of the housing legislation.

“Making such broad changes in a precipitous manner without adequate study and analysis is unprecedented and, perhaps, unnecessary,” Mr. Bachus wrote.

Democrats, who found themselves in an unusual alliance with the Bush administration, immediately criticized the Republicans endangering the global economy by trying to stall the housing legislation. They said it would take until early next week, at least, for the House to act.

The reluctance by Republicans to embrace President Bush’s plan came as shares in Fannie Mae and Freddie Mac plunged again on Tuesday, raising the chances that the federal government might need to take over the companies — a prospect that some fiscal conservative lawmakers likened to socialism.

“When I picked up my newspaper yesterday, I thought I woke up in France,” Senator Jim Bunning, Republican of Kentucky, said at a banking committee hearing. “But no, it turns out socialism is alive and well in America.”

The Republican opposition threatened to ignite an ugly fight with the White House that many G.O.P. lawmakers view as an increasing liability in a high-stakes election year. For some lawmakers facing tough re-election contests, opposing the rescue plan for the mortgage giants is a way to reaffirm their identity as budgetary hawks while publicly breaking with the deeply unpopular, lame-duck Bush administration.

In the Senate, Richard C. Shelby of Alabama, the senior Republican on the banking committee, said he had numerous questions about the administration’s proposal but he stopped short of expressing opposition to it. “I fear that we’re sitting on a financial powder keg,” Mr. Shelby said.

Democratic leaders have said they would incorporate the Treasury Department’s plan to aid the mortgage giants into a package of housing legislation that also includes a plan to help hundreds of thousands of borrowers at risk of foreclosure to refinance their mortgages. Mr. Frank had initially predicted that the House would add the administration’s plan and act on the housing package this week.

But as Republicans voiced their concerns on Tuesday, Representative Steny H. Hoyer of Maryland, the Democratic majority leader, said he expected that hearings would have to be held and that the House would not vote on the bill until next Tuesday.