Republicans relent, clear financial reform bill for debate
After three days of blocking tactics, Republicans allowed the financial reform bill to proceed. What's next? Weeks of amendments as Republicans – and some on the left – try to change the bill.
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Republicans will also seek to ease how the bill regulates derivatives. Speculation on derivatives was seen as a major contributing factor to the financial meltdown.Skip to next paragraph
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“A lot of people do derivatives, and they’re not just speculating,” says R. Bruce Josten, a lobbyist for the US Chamber of Commerce, which is opposing the bill. “If they force all the end-users to go through an exchange, all of this will be done in Singapore or Hong Kong. We will continue to run ads to oppose the draft bill.”
Democrats want to make changes, too
Meanwhile, liberals hope to use floor debate to strengthen regulation on a range of issues.
Foremost, perhaps, is an attempt to break up banks deemed "too big to fail." “If you have institutions too big to fail, then we have institutions too big to exist. We’re going to break them up,” said Sen. Bernard Sanders (I) of Vermont, who usually votes with the Democratic caucus. [Editor's note: The original version gave an incorrect party affiliation for Senator Sanders.]
He also has his eye on new transparency requirements for the Federal Reserve.
“During the bailout, the Fed lent trillions of dollars at zero or near-zero interest rates to large financial institutions," says Senator Sanders. "During the Budget Committee hearing, I asked Chairman Bernanke who received that money, [and] he refused to tell us."
“The bottom line is that trillions of taxpayer dollars were lent out and voters have a right to know who received it,” he added.
In the end, say Republicans, it was time to start debating the bill.
“Since the two senators [Dodd and Shelby] were unable to reach agreement, at this point it makes sense to proceed to floor debate,” said Sen. Susan Collins (R) of Maine, adding that she expects Senate majority leader Harry Reid to keep his “commitment to a free and open debate.”
[Editor's note: The original photo caption gave an incorrect party affiliation for Sen. Bernard Sanders of Vermont.]
The Monitor's View: The weak spot in the financial reform bill