WASHINGTON (AFP) — The top Democrat in the US Senate said Wednesday that a revised Wall Street bailout plan his colleagues plan to vote on later Wednesday also had a good chance in the House of Representatives.
Senate Majority leader Harry Reid also warned that there was no alternative to passing the bill quickly, adding that a major US insurance firm he did not name was on the verge of going bankrupt along with some other big companies.
The bailout bill was reworked after being stunningly rejected by the House on Monday, sparking fears that the US economy was about to plunge into a deep recession.
"I would not move forward on this if I didn't think the chance in the House was good," Reid said.
"Democratic and Republican leaders over there will have to make a decision -- but this is good legislation."
Reid also expressed confidence that the rescue plan would pass later Wednesday in the Senate, where only a third of members face re-election in November and are thus less exposed to the political price of voting for an unpopular bill than House members.
"I am confident that we will get a good vote and a good vote in the Senate is anything that passes," he told reporters after meeting Democratic senators in a luncheon meeting.
The Nevada senator also warned that without action, to relieve the US financial system of toxic mortgage debts, the whole US economy could seize up.
"We tend to focus on the stock markets; the stock markets is not the issue," Reid said.
"The credit markets are the issue," he said, describing them as "frozen."
"There are companies that have functioned in America for decades by borrowing money overnight. The cannot find money to borrow overnight."
Reid also warned that a member of the Democratic caucus had warned a major US firm was among those at the risk of foundering if a bailout bill was not passed soon.
"One of the individuals in the caucus today talked about a major insurance company, a major insurance company, one with a name that everyone knows that is on the verge of going bankrupt.
"That is what this is all about."
Reid did not identify the company, and it was not immediately clear which firm he was referencing.
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