April 24, 2010
Financial-Reform Bill Drama Nearing Final Act in Senate
With a Senate floor vote set for Monday, the six month-long political battle over a package of financial reforms will enter its third and final act, and there may be plenty of drama remaining.
That vote, known as cloture, is the only way the Senate can overcome a filibuster, and its outcome is likely to set the stage for another round of gamesmanship.
Going into the weekend, Democratic Banking Committee Chairman Chris Dodd and his GOP counterpart, Richard Shelby, were still discussing key differences in the hope of achieving a more bipartisan package of measures that could be tacked on to Dodd’s draft bill now awaiting discussion on the Senate floor.
“It's hard for me to believe there isn’t a compromise that could work,” says former FDIC Chairman Bill Isaac, echoing the view of other Beltway watchers.
After months of discussion, horse trading and occasional jousting, Democrats and Republicans remain divided over a lot of fine print and some very large print in the bill’s language. That includes regulation of over-the-counter derivatives, the powers of a new consumer protection agency for financial products and bank fees to help cover the cost of bailing out too-big-to-fail firms.
A deal of any import would change the outcome of Monday’s 5 p.m. cloture vote, which would decide whether or not to limit consideration of the bill to 30 additional hours. Sixty votes are necessary to achieve that, and thus prevent the possibility of a filibuster.
“At the end of the day, I think this will be a 75-80 vote bill. I think it is going to be largely a bipartisan bill. I think Shelby and Dodd will get together,” Camden Fine, president of the Independent Community Bankers of America told CNBC Friday. "I think they’ll work things out."
GOP Senate Leader Mitch McConnell of Kentucky says he has the support of all 41 Republican members, which would mean defeat for the cloture vote, even if all 58 Democrats and the one leftward-leaning independent senator supported it.
“I think the Republicans will see if they can hold together on Monday and strengthen Shelby's hand,” said one Democratic Senate aide.
If so, that could lead to final negotiations and a compromise, assuming Democrats are unwilling to call the GOP’s bluff.
Some Capitol Hill sources, however, say it’s unclear if McConnell can keep that voting block together for a second go round, without at least one moderate GOP senator joining the Democrats. And a defection may become more likely if the Democratic leadership waits to hold another vote.
“Why are we negotiating with Shelby and not trying to pick off some of the moderate Republicans?” said one Senate source. “Let’s keep hammering away and have them take another vote."
Democrats became somewhat emboldened after Charles Grassley (R-Iowa) voted along with Democrats on the Senate Agriculture Committee in approving a bill outlining derivatives regulation, which in one form or another will be folded into the broader financial reform package.
The stakes are unusually high for both parties with mid-term elections just six months away and reawakened memories of the financial crisis of 2008-2009 thanks to the emergence of the Goldman Sachs case.
Analysts say that makes it harder for any senator to vote against financial reform, assuming the right compromise package is ironed out.
Factions in both parties may make that difficult. Progressive Democrats, for instance, want greater protection and already feel Dodd’s bill has been watered down.
The Senate Agricultural Committee’s derivatives bill is tougher than the one thought to be favored by the Democratic majority on the banking committee.
“They [the Democrats] see themselves on a roll,” says banking analyst Bert Ely, “I don’t think this train is moving out of the station as smoothly as people believe.“
On the GOP side, some deem the CFPA’s powers under the current legislation are too powerful and have the potential to clash with the goals of other regulators, thus threatening the safety and soundness of the banking system.
Those concerns may not be enough for some GOP senators to want to risk being seen as obstructionist in an election year, especially with consumer group rallying around the reform issue and President Obama turning it into a stump speech.
Financial-Reform Bill Drama Nearing Final Act in Senate
With a Senate floor vote set for Monday, the six month-long political battle over a package of financial reforms will enter its third and final act, and there may be plenty of drama remaining.
That vote, known as cloture, is the only way the Senate can overcome a filibuster, and its outcome is likely to set the stage for another round of gamesmanship.
Going into the weekend, Democratic Banking Committee Chairman Chris Dodd and his GOP counterpart, Richard Shelby, were still discussing key differences in the hope of achieving a more bipartisan package of measures that could be tacked on to Dodd’s draft bill now awaiting discussion on the Senate floor.
“It's hard for me to believe there isn’t a compromise that could work,” says former FDIC Chairman Bill Isaac, echoing the view of other Beltway watchers.
After months of discussion, horse trading and occasional jousting, Democrats and Republicans remain divided over a lot of fine print and some very large print in the bill’s language. That includes regulation of over-the-counter derivatives, the powers of a new consumer protection agency for financial products and bank fees to help cover the cost of bailing out too-big-to-fail firms.
A deal of any import would change the outcome of Monday’s 5 p.m. cloture vote, which would decide whether or not to limit consideration of the bill to 30 additional hours. Sixty votes are necessary to achieve that, and thus prevent the possibility of a filibuster.
“At the end of the day, I think this will be a 75-80 vote bill. I think it is going to be largely a bipartisan bill. I think Shelby and Dodd will get together,” Camden Fine, president of the Independent Community Bankers of America told CNBC Friday. "I think they’ll work things out."
GOP Senate Leader Mitch McConnell of Kentucky says he has the support of all 41 Republican members, which would mean defeat for the cloture vote, even if all 58 Democrats and the one leftward-leaning independent senator supported it.
“I think the Republicans will see if they can hold together on Monday and strengthen Shelby's hand,” said one Democratic Senate aide.
If so, that could lead to final negotiations and a compromise, assuming Democrats are unwilling to call the GOP’s bluff.
Some Capitol Hill sources, however, say it’s unclear if McConnell can keep that voting block together for a second go round, without at least one moderate GOP senator joining the Democrats. And a defection may become more likely if the Democratic leadership waits to hold another vote.
“Why are we negotiating with Shelby and not trying to pick off some of the moderate Republicans?” said one Senate source. “Let’s keep hammering away and have them take another vote."
Democrats became somewhat emboldened after Charles Grassley (R-Iowa) voted along with Democrats on the Senate Agriculture Committee in approving a bill outlining derivatives regulation, which in one form or another will be folded into the broader financial reform package.
The stakes are unusually high for both parties with mid-term elections just six months away and reawakened memories of the financial crisis of 2008-2009 thanks to the emergence of the Goldman Sachs case.
Analysts say that makes it harder for any senator to vote against financial reform, assuming the right compromise package is ironed out.
Factions in both parties may make that difficult. Progressive Democrats, for instance, want greater protection and already feel Dodd’s bill has been watered down.
The Senate Agricultural Committee’s derivatives bill is tougher than the one thought to be favored by the Democratic majority on the banking committee.
“They [the Democrats] see themselves on a roll,” says banking analyst Bert Ely, “I don’t think this train is moving out of the station as smoothly as people believe.“
On the GOP side, some deem the CFPA’s powers under the current legislation are too powerful and have the potential to clash with the goals of other regulators, thus threatening the safety and soundness of the banking system.
Those concerns may not be enough for some GOP senators to want to risk being seen as obstructionist in an election year, especially with consumer group rallying around the reform issue and President Obama turning it into a stump speech.
