WASHINGTON— If lawmakers—or anyone else—were expecting specifics or guarantees from the Bush Administration's bailout plan authors, they came away disappointed from the first congressional hearing on the controversial $700 billion plan.

The Senate Banking Committee's members turned out in full force to pepper Treasury Secretary Henry Paulson and Federal Reserve chairman Ben Bernanke with skeptical and sometimes combative questions and comments.

As senators scored points, some in the standing-room-only crowd waved pink placards with sentiments like "No Blank Checks," and echoed their approval of the toughest questions, which centered on whether wholesale purchases of mortgage assets with virtually no conditions or guaranteed return was the best way to shore up the American financial market.

The committee chairman, Democrat Christopher Dodd of Connecticut, set the tone when he described the administration proposal as "stunning and unprecedented in its scope and lack of detail."

No one denied the situation is serious and something has to be done, but even Republicans seemed far from convinced. "I'm frightened to the point of panic that I don't see your plan working," said Jim Bunning, a former right-hander for the Phillies who is now a Republican senator from Kentucky. He called the plan "financial socialism."  

His Republican colleague, Richard Shelby of Alabama, noted that Congress had "been given no credible assurances that this plan will work. We could very well spend $700 billion, or a trillion, and not resolve the crisis."

Even so, the Bush administration's dark-suited lineup of Paulson, Bernanke—with an occasional assist from Christopher Cox, the chairman of the Securities and Exchange Commission—stuck staunchly to the script, ducking and weaving around sticky questions like taxpayers getting an equity stake and reining in runaway executive compensation.

That included generalities like Paulson's insistence that he wanted "a broad range of institutions" to participate and to include a "broad range of assets"—but beyond that the specifics were super skimpy.

Bernanke, though, gave some clues to the government's direction when he said that if the Treasury Department "bids for then buys assets at a price close to the hold-to-maturity price, there will be substantial benefits."
Calculating that versus what he called "fire-sale prices"— which appears to mean what the securities could fetch at today's prices—provoked a flurry of questions that were never really answered about just how these admittedly complex securities would be valued. Both men said they would tap experts to help them figure this out, but they insisted they could take care of business and that Congress should not be tying their hands.

While a few mild protestors circulated—many wearing red baseball caps and T-shirts calling for a bail out of "Main Street, not just Wall Street"—Bernanke warned that the country could race more joblessness and foreclosures as markets continued to be shaky.

"This is all about taxpayers," agreed Paulson, who blamed an outdated regulatory system for the tumult and said a broad rescue of the financial system required a different approach than saving an individual financial institution, like an American International Group, the giant insurer that was lent $85 billion from the government.  

The enormity of the sums seemed to flummox even the senators. Senator Mike Enzi, Republican of Wyoming, said data showed the $700 billion plan would cost $2,300 for each taxpayer (actually about $2,300 for each American citizen). Bernanke didn't disagree, noting that represented about 5 percent of all outstanding mortgages.

New York Senator Charles Schumer, a Democrat, proposed putting up $150 billion—instead of $700 billion—and revisiting the issue in January, but that didn't seem to cut it with Paulson, who repeated that he was frustrated but kept insisting that he didn't want to attach conditions that would discourage companies from participating in the plan.

And that appeared to include curbing executive compensation—with taxpayers complaining about executives walking away with multiple millions while they are struggling to pay considerably more modest mortgages.

Paulson did clear up one point—the plan would cover foreign financial institutions which do business and employ people in the United States.

Interestingly, one of the save-this-seat placards at the front of the room was marked for representatives of the embassies of Costa Rica and Germany.

While Paulson seemed vague, he may have been playing his cards close to his chest to avoid undercutting the intense negotiations now underway in Congress. Talks with the House Financial Services Committee, headed by Barney Frank, Democrat of Massachusetts, have settled on an oversight board to monitor the program, relief for homeowners facing foreclosure, and the Treasury's ability to take equity stakes in companies seeking assistance. The Treasury will have the ability to take equity stakes in companies that seek federal assistance.

Bernanke urged Congress to act quickly to stabilize the economy and "avert what otherwise could be very serious consequences for our financial markets and for our economy."