Is Harry Reid smart to push for a vote on financial reform?

Senate majority leader Harry Reid (D) of Nevada announced Thursday he will hold a crucial procedural vote on financial reform Monday, even before an agreement is reached on the legislation.

Some Republicans, such as the moderate Sen. Susan Collins of Maine, expressed concern that by scheduling a vote before there is a bipartisan accord and before Senator Reid knows that he has the 60 votes needed to halt a filibuster, the majority leader is risking the progress the parties are making.

But Reid said on Thursday that he’s “not going to waste any more time of the American people while they come up with some agreement.”

“The games of stalling are over,” Reid said.

Options if the move succeeds or fails

If the Democrats fail to get at least one Republican to join the cloture vote by Monday, they can always go back to the drawing board and try again. And if they succeed in the procedural vote that allows debate to go forward, then the bill appears on its way toward passage.

The bill contains measures designed to prevent a repeat of the US financial crisis of 2008, including establishment of a new consumer protection agency, a regulatory council that monitors risk in the financial system, and a fund paid for by the financial industry that would be used to liquidate failed financial firms.

In recent days, Republicans have been softening in their opposition to the Democratic efforts at financial reform, as polls show the overhaul is popular – especially when it is dubbed “Wall Street reform,” as Obama called it in a speech Thursday, which he delivered blocks from Wall Street.

A good move for the Democrats

And, analysts says, the Democrats are smart to press ahead.

“This is a good political move for Democrats,” says Larry Sabato, a political scientist at the University of Virginia, Charlottesville. “It’s populist, it’s anti-Wall Street, it helps to compensate for the fact that voters have tagged them, however unfairly, with the bailout.”

The reform push also could insulate the Democrats against charges they’re getting too cozy with Wall Street. A majority of financial firms’ political donations go to them, as the party in power.

If Reid’s gambit fails, and financial reform dies, then the Democrats at least gain an issue for the fall elections. But it’s more likely that the Democrats want to head into the midterms with a major bipartisan accomplishment, following passage of health-care reform on just Democratic votes.

“Reid would rather have a bill with 70 votes than one with barely 60,” says Norman Ornstein, a resident scholar at the American Enterprise Institute in Washington.

In addition, there’s nothing that says the first vote has to start at 5:15 p.m. on Monday, as currently planned. For example, if Sen. Christopher Dodd (D) of Connecticut, chairman of the Senate Banking Committee, went to Reid and asked for 24 hours more to work on a deal, he would surely get it, Mr. Ornstein says.

For the Republicans, time is not on their side.

“The Republicans would do well to get this out of the way and go back to their issues,” says Mr. Sabato. “This only helps the Democrats.”