The proposed legislation would raise the government's debt ceiling to $11.3 trillion.
A $700 billion expenditure on distressed mortgage-related assets would be roughly what the country has spent in direct costs on the Iraq war and more than the Pentagon's total yearly budget appropriation. It represents more than $2,000 for every man, woman and child in the United States.
The plan gives the secretary full discretion to use the powers as he sees fit in hiring employees or forming agencies to carry them out.
Congress has pledged to move swiftly to stabilize the financial markets, which were succumbing to panic last week. The Dow Jones industrial average fell to its lowest level in almost three years as giant financial institutions teetered on the verge of collapse and global credit markets seized up as banks hoarded their cash.
Bush stressed that the sweeping solution was necessary.
"My first instinct wasn't to lay out a huge government plan. My first instinct was to let the market work until I realized, upon being briefed by the experts, of how significant this problem became," Bush said. "And so I decided to act and act boldly.
"The American people have got to know that I made this decision, along with a lot of experts, because it was necessary to protect them. In the long run, we're going to be fine," Bush said.
The plan unveiled yesterday was developed by Paulson and Federal Reserve Chairman Ben S. Bernanke, who spent much of their day Friday on the phone pleading for speedy action by Congress. Lawmakers who spoke with them in those calls said the pair presented a sobering picture of just how fragile financial markets have become.
"All of us are prepared to do whatever we can this weekend ... to fashion a proposal that will get us out of this mess," said Sen. Christopher J. Dodd, a Connecticut Democrat and chairman of the Senate Banking Committee, who was expected to shepherd the plan through the Senate. "We understand the gravity of the moment."
Beneath the surface, however, questions about the administration's approach were raised even before the plan was unveiled. And, with the Nov. 4 presidential election only weeks away, political tensions inevitably arose as well.
On Capitol Hill, Republicans denounced the move away from free-market principles.
