Journal staff and wire reports

South Dakota's two senators split their votes Wednesday on a $700 billion financial industry bailout bill, and that surprised some who had spoken with Democratic Sen. Tim Johnson earlier in the day.

The Senate passed the bill, 74-25, after the House rejected a similar bailout Monday, sweetening the deal with added tax breaks for businesses and the middle class and increased deposit insurance. Johnson voted against the bill, arguing that it doesn't do enough to fix the problems that caused a widespread economic meltdown.

Johnson, a member of the Senate Banking Committee, said in a statement issued just before the vote that he struggled with his decision.

"Despite the fact that this proposal has merits, I continue to have concerns that it lacks the necessary protections to fix the abuses that caused this problem, provides little direct assistance to American families, does not go far enough to cut the golden parachutes of irresponsible CEOs and does not do enough to address American tax dollars benefiting foreign banks," he said.

Johnson's "no" vote surprised Curt Everson, president of the South Dakota Bankers Association. Everson and other members of the bankers association were on a conference call with Johnson earlier in the day and came away believing Johnson would support the revised bailout bill.

"We had thought (Johnson) was going to support giving the Treasury the authority to remove some of these illiquid assets," Everson said Wednesday night. "We were surprised."

Everson said Johnson told the group that he recognized the serious nature of the financial problems and the need to address them, but Everson admitted the South Dakota senator never specifically promised them he would vote for the bill.

Johnson campaign manager Steve Jarding, when told of Everson's concern, said it was a particularly difficult vote for Johnson.

"Tim was weighing facts and opinions over the past several days and has at various times leaned one way or another," Jarding said. "But in the end (he) did not feel the bill adequately addressed all of his concerns and felt he had to vote against it."

Republican Sen. John Thune voted for the bill, saying he supports the bill's added market oversight and its curbs on executive pay. Thune told reporters earlier in the day that he believes the country is in a crisis, and it requires "strong, decisive, bold action."

"It would have been easy to do the politically popular thing and vote against this bill, but for me, it would not have been the responsible thing to do," Thune said.

South Dakota's only member of Congress, Democratic Rep. Stephanie Herseth Sandlin, voted against the bailout Monday but has not decided whether she will support the new version of the bill.

"I am going to be taking a close look at all of this, but the bottom line is whatever package comes before the House, I do not anticipate that it will be the most fiscally responsible package that I would prefer," she said.

The House is expected to consider the revised bill Friday.

BREAKOUTS

Additional comments from Sen. John Thune:

"I'm sure those who voted against this package have their reasons, but the sober facts are that without intervention, our credit markets will freeze, our economy will grind to a halt, and the impact will be severe and felt by every South Dakotan.

"To be clear, this legislation is not intended to bail out Wall Street, but rather insulate main streets across South Dakota and the country. I am frustrated that the government is being forced into this position, but the authority this bill provides is temporary. It also ensures strong oversight and strong taxpayer protections and it prevents Wall Street executives from walking away from their failed companies with golden parachutes.

"This is not money we are just throwing away; we are investing this money in assets that will later be sold, which means the government potentially stands to make a good portion, if not all of it, back in the long run, while calming the uncertain financial waters we are now battling."

Additional comments from Sen. Tim Johnson:

"South Dakota has not seen the highs and lows of the housing market in the same way as other areas of the country, and South Dakotans exercised strong personal responsibility when it came to buying their homes, which is why this mess is all so frustrating.

"It is very unfortunate that greedy Wall Street investors brought us to this point and that the regulators were asleep at the switch when we needed them most.

"There is no question that something must be done to address this situation. But, throughout this process, I have made clear that while this may be a necessary evil, it cannot be a gift that puts undue burden on the American taxpayer."

"If we are to ask the American people to shoulder such a large and enduring burden because of the irresponsible and greedy actions of Wall Street, then it is important that we get it right. This is closer, but it's not close enough."