Bipartisanship Aside, Financial Bill Faces Decision

It's showdown time Monday on the financial regulations bill. After a week of back-and-forth, Republicans will have to decide whether to go along with a bill that creates a new consumer protection bureau, regulates derivatives and puts in place a system for winding down banks considered "too big to fail."

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SCOTT SIMON, Host:

This is WEEKEND EDITION from NPR News. I'm Scott Simon.

Showdown(ph) time in the U.S. Senate this weekend. Lawmakers on the banking committee say they're working through the weekend to get a bipartisan agreement on new rules for Wall Street by Monday. That's when the financial regulatory overhaul is up for a key procedural vote.

As NPR's Audie Cornish reports, the rancorous political atmosphere from the health care debate still lingers over negotiations.

AUDIE CORNISH: For months now, lawmakers have been saying that debate over financial regulations would be nothing like health care, that there was 70, 80, 90 percent agreement on what should be in the bill, and with just a little more time a bipartisan proposal could emerge. Well, it looks like time is almost up.

BOB CORKER: You know, I think by all accounts most people felt like we were almost completed. The analogy that's been used is we were on the five yard line and the lights went out.

CORNISH: That's Tennessee Republican Senator Bob Corker, who was at one point working toward bipartisan legislation. But while party negotiators on the banking committee are still lobbying for time to reach an agreement, party leaders on the Senate floor appear a lot less interested.

HARRY REID: This kabuki dance we've been involved in for months now.

CORNISH: Senate Majority Leader Harry Reid.

REID: This game is apparent to the American people. My friends on the other side of the aisle are betting on failure again, as they did with health care, as they have done everything this year. They didn't get - health care was not Obama's Waterloo. Maybe they want this to be his Waterloo, but it's not going to be.

CORNISH: Senator Reid says the first lesson he's learned from the health care debate is not to put too much stock in calls for bipartisanship, so he's plowing ahead with a crucial test vote on Monday night to take up the bill. He'll need 60 votes and he only has 59 in his caucus.

Meanwhile, the GOP minority leader, Mitch McConnell, has gotten commitments from all 41 Republicans that they won't vote to start debate if the bill stays in its current form. Republicans particularly oppose a proposed $50 billion fund for winding down failing firms. They say loopholes in the bill could encourage regulators to keep a financial firm on a sort of life support. McConnell says that could result in the kind of bailouts Americans fear.

MITCH MCCONNELL: The first thing they want us to prove is that this bill ends bailouts. That was the one thing this bill was supposed to do, the one thing it was supposed to do. And if this bill didn't do anything else but that, a lot of people would be satisfied. The administration has said it wants to end bailouts; I say to them, prove it.

CORNISH: Democrats say the fund, paid for by banks, is for liquidation, not rescue, and this leads to another lesson of the health care debate, says New York Democrat Charles Schumer - define or be defined.

CHARLES SCHUMER: Bottom line: on the health care bill we allowed too many lies to get out there without rebuttal, because we thought they were so obviously untrue.

CORNISH: Democrats in the Senate and the White House say the fund isn't central to the bill, but they've replied with fiery rhetoric just the same.

SCHUMER: We've learned out lesson, and the minute these things come out of the mouths of some of our Republican colleagues, we rebut them and we rebut them again and again. And fortunately, these lies are not taking hold.

CORNISH: As for those bipartisan negotiations, what's the holdup? While lawmakers are trying to work out how much power the proposed Consumer Protection Bureau should have to write its own rules and how far states can go in enforcing them, they're also looking at how to merge competing provisions dealing with the derivatives market.

And besides the $50 billion bank fund, there's also a contentious proposal to bar banks from doing trades with depositor money. If these issues aren't hashed out over the weekend, lawmakers outside the negotiations are lining up with amendments to tackle them on the Senate floor - if the bill gets there.

Audie Cornish, NPR News, the Capitol.

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