US News
Bush plans to veto housing bill
By DPA
May 7, 2008, 23:31 GMT

Washington - US President George W Bush promised Wednesday to veto a costly initiative making its way through Congress to address the housing crisis at the centre of an economic slowdown in the United States.

Democrats are pushing for a broad bill that would create a 300- billion-dollar fund to help homeowners threatened with foreclosure and provide tax incentives for people to buy new homes.

Bush said the Democrats' housing plan would 'reward speculators and lenders' rather than individuals struggling to stay in their homes, and urged the House of Representatives to adopt a rival Republican version that is less expansive.

But Speaker Nancy Pelosi - the leading Democrat in the House - said the bill had support from both parties as members began debating the new initiative on Wednesday.

'American families confronting foreclosure deserve better from the president than a veto threat,' she said.

Government agencies have worked to help homeowners refinance their mortgages, but the Bush administration has opposed using taxpayer funds to bailout homeowners or speculators who took excessive risks, or took out mortgages they could not afford.

A dramatic drop in home prices in the past two years prompted a record number of foreclosures since August. Investment banks and lenders have been hit with huge losses from the mortgage defaults, contributing to a wider economic downturn in the United States.

A House vote on the housing bill was possible by late Wednesday.