Sept. 26 (Bloomberg) -- Advisers to both presidential candidates warned today of adverse consequences should Congress fail to pass an economic rescue plan along the lines proposed by Treasury Secretary Henry Paulson.

Peter Wallison, an adviser to Republican candidate McCain, said that Congress must act to enact the $700 billion plan so banks can make loans, and criticized House Republicans for stalling negotiations yesterday. The Republicans made a last- minute proposal to cut taxes, reduce regulations and offer insurance on mortgage-backed securities.

``It's too late,'' Wallison, a resident fellow at the Washington-based American Enterprise Institute and former counsel to President Ronald Reagan, said in an interview with Al Hunt on Bloomberg Television. ``That's the kind of proposal that might have been put on the table a year ago. We have a plan on the table that will work.''

Congress will eventually enact legislation that provides the funding to bail out the financial markets, said Roger Altman, deputy treasury secretary under President Bill Clinton and now an adviser to Democratic nominee Barack Obama.

``The implications would be so adverse that the odds of their failing to do so are quite low,'' Altman, chief executive officer of the investment bank Evercore Partners Inc. said during the joint interview. ``I don't think we all want to contemplate them.'' Evercore is advising a group of investors who are trying to prevent their shares from being diluted in the U.S. takeover of American International Group Inc.

The proposal that Democratic and Republican congressional leaders had been negotiating with the Bush administration would provide $700 billion, limit executive compensation and provide for oversight. Today House Republicans said they are rejoining talks on the financial-rescue plan, and leaders from both parties vowed Congress would stay in session until a deal is reached.

While the plan has sparked calls to lawmakers from voters protesting a bailout for Wall Street, lawmakers have no choice, Wallison said.

``That's why we pay them the big money,'' Wallison said. ``They've got to once in a while put their careers on the line for the sake of the economy.''

To contact the reporter on this story: Jonathan D. Salant in Washington at jsalant@bloomberg.net.

Last Updated: September 26, 2008 15:02 EDT