Corporate Governance

Chrysler will not pay back either the original government bailout loan nor the funds the government provided to maintain operations during bankruptcy proceeding.

One of the company's financial "assumptions" in its bankruptcy filing is that the government will forgive both the original $4 billion loan from the Bush administration, the $300 million fee from the loan and the latest installment of $3.2 billion that the Obama administration provided to prop up the company during bankruptcy.

From CNN Money:

An Obama administration official confirmed Tuesday that Chrysler won't be repaying the loans, though a portion of the bridge loan may be recovered by Treasury from the assets of Chrysler Financial, the former credit arm of the automaker which is essentially going out of business as part of the reorganization.

"The reality now is that the face value [of the $4 billion bridge loan] will be written off in the bankruptcy process," said the official, who added that the 8% equity stake that Treasury will be receiving as part of the company's reorganization is meant to compensate taxpayers for the lost money.

"While we do not expect a recovery of these funds, we are comfortable that in the totality of the arrangement, the Treasury and the American taxpayer are being fairly compensated," said the official.

Rep. John Lewis (D-Ga.) cited the prospect of new leadership in Washington as a reason for switching his vote to yes on the bailout bill.

"In a few months, we will have a new president and a new congress. We must hold companies' feet to the fire. It is with this assurance that I will vote yes," said Lewis, who voted against the bill Monday.

Lewis told his Democratic colleagues earlier that he had spoken with Democratic presidential nominee Barack Obama, a supporter of the bailout, and that he too would back the bill.

"I've decided that the cost of doing nothing is greater than the cost of doing something," Lewis said on the House floor Friday.

House Minority Whip Roy Blunt (R-Mo.) tried to allay taxpayer concerns over the rescue package.

"It's not a bailout, it's a situation where American taxpayers are going to invest money in a way that ensures that they'll have a return," he said.

He noted the bill's provision that requires the president to come up with a plan to recoup any lost money due to the program after five years.

Rep. Hilda Solis (D-Calif.), who voted against the bailout bill on Monday, suggested on the House floor she will support the new financial rescue package.

House Energy and Commerce Committee Ranking Member Joe Barton (R-Texas) will stick with his no vote. Rep. Mike Pence (R-Ind.) will also vote no again.

Rep. Walter Jones (R-N.C.) said on Thursday that if the financial bailout bill is passed, it will lead to "the decline of democracy in America."

Jones told The Hill that the measure is a step toward socialization, with "government taking over for private enterprise."

Jones, who voted against the House rescue plan on Monday and will vote against the revised package on Friday, said six out of every seven calls to his office has been against the legislation.

The GOP lawmaker has regularly bucked his party over the last several years, most notably on the Iraq war.

Senate Banking Committee Chairman Chris Dodd (D-Conn.) said Wednesday there will be no further changes to the $700 billion financial rescue plan being voted on later in the evening by the Senate, and that a successful House vote is the only possible next step.

Dodd said the legislation is too critical to go through any more "ping-pong-ing" between Congress's two chambers. Senate leaders have added an increase in Federal Deposit Insurance Corporation coverage of bank deposits, from $100,000 to $250,000, as well as extensions of popular tax credits and a freeze on the expansion of the Alternative Minimum Tax, all in an effort to coax more support from wavering House GOP members.

Dodd said Senate negotiators resisted the temptation to add more.

"I don't want this to go back and forth," Dodd said. "We can't start to shuttle this bill. This bill is what it was, with the addition of the tax extenders and the FDIC provisions. Other than that, it's the same bill. So the House is going to have to belly up and deal with this. Does that mean I wouldn't want to write it differently? There were several ideas that I would have added last night. But if I did I'm just opening up this process, and we can't go another four or five days, ping-ponging this bill back and forth to the satisfaction of everyone."

-J. Taylor Rushing

Senate Democratic and Republican leadership aides are offering similar predictions of what tonight's final vote on the $700 billion financial plan will look like: Expect a number around 70 votes.

GOP aides say a majority of the Senate's 49 Republicans -- probably around 30 -- will vote for the bill, and Democratic aides expect slight more, about 40, from their side.

Seventy votes would easily exceed the 60-vote threshold necessary for passage according to a consent agreement hammered out Tuesday between Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.)

-J. Taylor Rushing

The Senate will vote Wednesday on its version of the economic bailout.

Read all 451 pages of the bill on TheHill.com.

Like the version rejected in the House Monday, the Senate's seeks to give the Treasury Department authority to spend up to $700 billion to purchase bad mortgage assets from private financial firms. But unlike the House's bill, the Senate bill includes tax measures to extend and create incentives for renewable energy programs and to provide a patch next year for the Alternative Minimum Tax. It would also expand the federal guarantee for money in bank accounts. Under current law, the Federal Deposit Insurance Corporation guarantees an account up to $100,000; the Senate bill seeks to increase the limit to $250,000.

Both Senate Majority Leader Harry Reid (D-Nev.) and Minority Leader Mitch McConnell (R-Ky.) have hailed the bill as a bipartisan effort and are pressing House members to also back it.

But House Majority Leader Steny Hoyer (D-Md.) has already said that he's "not pleased" by the addition of the AMT patch. Centrist Blue Dog Democrats in the House have opposed any AMT patch that doesn't come with offsets for the revenue that would be lost.

Now Cindy Sheehan, the anti-war activist and House candidate, is attacking House Speaker Nancy Pelosi (D-Calif.) over the $700 billion bailout.

A day after House Republican leaders blamed a Pelosi speech for the bailout bill's failure, Sheehan said Pelosi is working "for corporate interests" by backing the plan.

"She put this bill forward and voted against the will of her district," said Sheehan, who is running as an independent for Pelosi's San Francisco seat. "Thankfully my opponent wasn't able to get the votes she needed in her own House to get it to pass. I am heartened that 'We the People' won the first round in the corporate bailout of irresponsible and greedy bankers."

Sheehan, in a press release, also called for a "bottom up" rescue plan that would place a moratorium on foreclosures and include more help for homeowners.

Sheehan, whose son, Casey, was killed in Iraq while serving in the Army, has been critical of Democrats' inability to end the war. She said she's running against Pelosi because she hasn't brought up articles of impeachment against President Bush.

Monday's failed House vote on a $700 billion bill to stabilize the U.S. financial markets has not only rattled Wall Street; it has rattled GOP Senate leaders' confidence in their powers of prediction.

Twice on Tuesday, prominent Senate Republicans hedged when asked about legislative strategy or process, reminding reporters that they