Lawmakers Reach Accord on Huge Financial Rescue

Congressional leaders and the Bush administration this morning said they had struck an accord to insert the government deeply into the nation's financial markets, agreeing to spend up to $700 billion to relieve Wall Street of troubled assets backed by faltering home mortgages.

House and Senate negotiators from both parties emerged with Treasury Secretary Henry M. Paulson Jr. at 12:30 a.m. from a marathon session in the Capitol to announce that they had reached a tentative agreement on a proposal to give Paulson broad authority to organize one of the biggest government interventions in the private sector since the Great Depression.

Congressional aides worked through the night to assemble the package, and hoped to post it to the Internet by midday today. Meanwhile, as preparations were being made for a vote in the House tomorrow morning, the congressional caucuses were preparing their own private huddles to review the proposal. The most critical meeting, among House Republicans, was expected later this afternoon. They have been the most reluctant to support the plan to purchase the securities. House Democrats were likely to meet in mid-afternoon.

"We've made great progress, but we have to commit it to paper before we can formally agree," said House Speaker Nancy Pelosi (D-Calif.), who has pledged to make the plan available to the public for at least 24 hours before the House votes on it. A vote could come as early as tomorrow in the House, with the Senate expected to follow soon after.

"We've been working on this a long time. We've still got more to do to finalize it, but I think we're there," Paulson said. "So far, so good."

Rep. Roy Blunt (R-Mo.), who represented House Republicans, the group that had raised the most serious objections to the plan, said he was pleased with the progress made but that he had to take the proposal back to his caucus before committing his support for it. "I look forward to what we're going to see on paper and presenting these ideas to my colleagues and getting their reaction," Blunt said.

House Republicans appeared headed for a potentially spirited fight.

The office of House Minority Leader John A. Boehner, without officially endorsing the legislation, put out a series of talking points in the early afternoon outlining the favorable portions of the bill for conservatives.

However, one leading conservative, Rep. Mike Pence (R-Ind.), issued what amounted to a call to arms to fight the bailout.

"The decision to give the federal government the ability to nationalize almost every bad mortgage in America interrupts this basic truth of our free market economy. ... Before you vote, ask yourself why you came here and vote with courage and integrity to those principals. If you came here because you believe in limited government and the freedom of the American marketplace, vote in accordance with those convictions," Pence wrote to House Republicans today.

A senior administration official, who requested anonymity to speak freely about the plan, said both sides had made significant concessions to achieve compromise. The Bush administration has agreed to accept a number of Democratic demands, including:

· The money would be disbursed in segments, with Paulson receiving $250 billion immediately, $100 billion upon White House certification of its necessity and the final $350 billion only after Congress has been given 15 days to object.