JEFFERSON CITY, Mo. (AP) -- Before he was against it, U.S. Rep. Roy Blunt was for a 2008 bill authorizing up to $700 billion to shore up banks and other troubled financial institutions. In fact, Blunt helped negotiate its details and - as House Republican whip - helped round up enough votes to ensure its passage.
Now a candidate for U.S. Senate, Blunt is carefully parsing his past support for the unpopular bank bailout. Blunt's Senate campaign last month accused his Democratic opponent, Secretary of State Robin Carnahan, of "falsely asserting that Roy Blunt supported a $700 billion bailout package."
Carnahan, who publicly proclaimed no position on the legislation in 2008, now says she would have voted against it. She's using Blunt's `yes' vote to portray him as an ally of Wall Street instead of Main Street.
The bank bailout passed Congress in October 2008 as big financial institutions were failing and stock markets were plummeting. President Barack Obama was still a Democratic senator from Illinois at the time, and Blunt and Carnahan were cruising toward easy re-election victories in their current offices.
Two years later, with smaller banks still failing weekly and unemployment still high, the Toxic Asset Relief Program (or TARP) remains an issue in campaigns across the nation. Perceptions of it generally are negative - even though much of the initial money has been paid back to the federal government.
A survey last month by the Pew Center for the People and the Press found 74 percent of Americans believe the government's economic policies have helped large banks and financial institutions. But 68 percent said those policies have done little or nothing for middle-class residents and small businesses.
That perhaps provides some context about why neither Carnahan nor Blunt wants to be associated too closely with 2008 financial legislation as they campaign for the Senate.
In Sept. 29, 2008, House speech encouraging colleagues to support the bill, Blunt described it not as a bailout but as a "program that could be a work out" for financial institutions stuck with investments in bad mortgages.
The program had plenty of oversight, Blunt said, and could encourage financial institutions to again make loans for homes, businesses and students.
"This is not about Wall Street, it's about Main Street," Blunt said during his speech.
The House defeated the legislation that day. But it was revived in the Senate and passed the House 263-171 on Oct. 3. Blunt again voted for it.
The legislation allowed the federal government to use $250 billion immediately for financial institutions and an additional $100 billion if the president (who at the time was George W. Bush) certified it was necessary. The remaining $350 billion could be spent following a separate certification of need by the president, so long as Congress did not pass a resolution of disapproval.
It's that second contingency clause which Blunt cites to say that he did not support the full $700 billion bailout.
After the bill passed, the Bush administration initially tried to acquire bad assets from financial institutions, then shifted to infusing banks with money and later used a small portion of the bailout fund for automakers.
In January 2009, a divided U.S. Senate approved a request by Obama - then the president-elect - to use the remaining $350 billion authorized under the legislation.
A few days later, Blunt joined a majority of House members in voting 270-155 to block the second half of the $700 billion bailout bill. But that vote was largely symbolic, because the rejection would have needed to pass both chambers and the Senate had already approved the use of the money.
In an interview this past week, Blunt said he supported the initial $350 billion for financial institutions as "a short-term investment in the economy that gets paid back with significant profit."
But "he opposed a second bailout because he believed the administration mismanaged the first installment and has opposed every bailout since then," Blunt spokesman Rich Chrismer said in a written statement.
Blunt's campaign has suggested that Carnahan also has both supported and opposed aspects of the 2008 legislation.
In covering a Carnahan campaign event, the Sedalia Democrat reported in July that Carnahan said the bailout money may have been needed to stabilize the economy but that Blunt and others failed to attach strict controls on how it was spent.
In a follow-up story two weeks later, Carnahan said she's not convinced banks were in a crisis and told the newspaper: "I wouldn't have voted for it then, and I don't support it now." Her campaign referred the AP to that second story when asked recently about her position on the legislation for financial institutions.
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