Lawmakers Battle Over Rescue Plan (Greg Hitt, Damien Paletta, Deborah Solomon)

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Barney Frank

WASHINGTON -- Lawmakers are scrambling to put their mark on the Bush administration's $700 billion plan to save financial markets -- a fast-moving test of wills that could reshape one of the biggest bailouts in U.S. history.

There's no sign yet that Congress will delay or derail the proposal. Democrats are looking to add provisions that include beefed-up congressional oversight, aid for individual homeowners and changes to bankruptcy laws.

{xtypo_quote_right} Regarding executive pay, Rep. Frank's draft would mandate that any company selling assets into the program "meet appropriate standards for executive compensation," including limits on what could be deemed excessive or inappropriate, according to a copy seen by The Wall Street Journal. The government would also have the ability to "claw back" incentive pay that was based on "earnings, gains, or other criteria that are later proven to be inaccurate." Mr. Paulson is resisting those efforts. {/xtypo_quote_right}

Some of the measures are opposed by the administration. Perhaps the biggest looming fight is over Democratic efforts to require the program's participants to curb what they pay their executives.

Last week, as deep new fissures opened in global financial markets, the U.S. Treasury unveiled a plan to spend up to $700 billion to buy soured mortgages and mortgage-related securities from financial institutions. In many respects, the financial sector last week all but ceased to function.