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Obama: On bank reform, Sen. McConnell is 'cynical and deceptive'

Obama and the GOP are fighting over bank reform. Republicans accuse the administration of pushing a 'bail out.' The White House says opponents are 'trying to kill reform on behalf of big banks.'

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Democrats insist that the bill “has been written specifically to end any notion of any kind of a bailout by the American taxpayer again," as Senate Banking Committee Chairman Chris Dodd, (D) Connecticut, said Thursday.

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"Our bill stops bailouts by imposing ... tough new requirements on Wall Street firms," Dodd said. "Being too big and too interconnected will cost these firms dearly. And should that not be enough … regulators can use the new powers in our legislation to break these firms up before they can take down the economy of our country."

The dispute is made more pointed by Friday’s announcement that the Securities and Exchange Commission has charged Wall Street giant Goldman Sachs with fraud over its packaging of a subprime mortgage investment.

Clash between Wall Street and regulators

As the Wall Street Journal noted, the case sets up “the biggest clash between Wall Street and regulators since junk-bond king Drexel Burnham Lambert succumbed to a criminal insider-trading investigation in the 1980s, helping to define the era.”

And as the newspaper also points out, “The SEC lawsuit likely strengthens the position of President Barack Obama as he tries to push financial-overhaul legislation through Congress.”

For his part, House Minority Leader John Boehner, (R) of Ohio, insists that the SEC suit against Goldman Sachs provides further reason to oppose the measure, Business Week reports.

"These are very serious charges against a key supporter of President Obama’s bill to create a permanent Wall Street bailout fund," Boehner said in a statement after the SEC lawsuit was announced. The bill “gives Goldman Sachs and other big Wall Street banks a perpetual, taxpayer- funded safety net by designating them ‘too big to fail.’”

It didn’t take long for White House spokesman Robert Gibbs to push back.

“Actions speak louder than words,” he said. “Barack Obama is on the side of new rules for the road and fighting big bank bailouts and John Boehner is on the side of trying to kill reform on behalf of big banks.”

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