The U.S. House of Representatives rejected plans Monday for what would have been the largest government bailout since the Great Depression.
Although it looked as if it might be approved, the $700-billion bailout to save Wall Street was rejected by the House in a 228 to 205 vote, according to House records.
"The strange thing was everyone woke up this morning thinking the bill was going to pass," said Jonathan Hamilton, chairman of UF's economics department. "The only way to rationalize that is everybody thought the bailout was going to be at least a little bit of a bad thing."
He said the bailout would have used government money to purchase assets from struggling financial institutions, but some representatives thought it would give relief to groups that didn't deserve it.
"It was going to reward some people who were guilty of excessive risk taking," Hamilton said.
It was not clear whether politicians would try to patch up the plan.
If a new bailout plan is proposed, it might give funds directly to banks, which are more regulated than other financial institutions and take fewer financial risks, Hamilton said.
UF economics professor Steven Slutsky said without an alternative bailout plan, the economy would continue to suffer.
"If nothing is done, the concern is that it will spread and worsen any downturn in the economy," Slutsky said.
Without some form of government intervention, banks might not have enough money to hand out loans, causing problems for businesses and people in need, he said.
Alligator staff writer Katie Gallagher contributed to this report.
