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The White House on Tuesday weighed in strongly against a bipartisan plan to remedy the ailing housing market, suggesting it could veto the legislation the Senate is on the verge of approving.
Meanwhile, House Democrats headed toward a clash with the Senate over how to rescue people from the mortgage mess by unveiling a package of tax measures that diverge sharply from the Senate’s approach.
“We need to provide relief to the buyers and families themselves, not just the banks and builders,” Ways and Means Committee Chairman Charles Rangel (D-N.Y.) said in a statement after introducing the tax package.
White House spokeswoman Dana Perino blasted the Senate legislation before a gaggle of reporters, saying it would “do more harm than good by bailing out lenders and speculators.”
But the move surprised Senate Republicans, who appeared to be in the dark about the Bush administration’s strong misgivings even after Vice President Dick Cheney attended their weekly Tuesday luncheon.
“You’re telling me something I was unaware of. It was unclear that the White House had a stated position yet on this bill,” Sen. Mitch McConnell (Ky.), the Republican leader, told reporters in response to a question about Perino’s statement.
Despite the administration’s qualms, the Senate on Tuesday afternoon agreed to proceed to a vote on the bill. At press time, it was not clear whether that vote would be held Tuesday night or on Wednesday.
The bill includes more than $11 billion in housing-related tax relief, including a $6 billion tax break for loss-making companies strongly backed by the National Association of Home Builders.
The White House opposes a provision in the bill that would grant $4 billion in funds to states and towns for purchasing and renovating foreclosed properties as well as a tax credit for people buying foreclosed properties — an idea proposed by a Republican, Sen. Johnny Isakson (Ga.).
“We have serious concerns that these elements and others would do little to help homeowners avoid foreclosure or reduce housing inventory,” Perino said.
The White House’s qualms with these provisions outweigh its strong support of measures contained in the bill to modernize the Federal Housing Administration (FHA) and to raise the cap on mortgage revenue bonds issued by states, she added.
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