On Friday June 25, we learned that the conference committee had finished hammering out the consensus version of the Wall Street reform bill:
Nearly two years after the American financial system teetered on the verge of collapse, Congressional negotiators reached agreement early Friday morning to reconcile competing versions of the biggest overhaul of financial regulations since the Great Depression.
A 20-hour marathon by members of a House-Senate conference committee to complete work on toughened financial regulations culminated at 5:39 a.m. Friday in agreements on the two most contentious parts of the financial regulatory overhaul and a host of other provisions. Along party lines, the House conferees voted 20 to 11 to approve the bill; the Senate conferees voted 7 to 5 to approve.
Members of the conference committee approved proposals to restrict trading by banks for their own benefit and requiring banks and their parent companies to segregate much of their derivatives activities into a separately capitalized subsidiary.
There was much celebration throughout the land:
Now that Democrats have agreed on a Wall Street reform bill, President Obama is set to have an incredible year of accomplishments. He’s already signed major health care reforms into law and is more than likely to have energy/climate change legislation on his desk later this year. Not since FDR has a president done so much to transform the country.
This turned out to be premature jocularity. Sen. Robert Byrd passed away, and several Republicans (and a pseudo-Democrat) decided that it was so not fair that banks should be asked to contribute to cover the costs of cleaning up after them:
Sen. Scott Brown (R-Mass.) is prepared to kill the bill over a modest bank fee that would help pay for the broader reform effort. Yesterday, Maine Sens. Susan Collins (R) and Olympia Snowe (R) said they’re also prepared to walk away from the bill over the bank fee. Making matters even worse, Sen. Ben Nelson (D-Neb.) said he’s “concerned” about the fee, suggesting his vote is far from secure, too. Sen. Maria Cantwell (D-Wash.), who supported the GOP filibuster last month, is non-committal, for now, as is Sen. Chuck Grassley (R-Iowa), who backed the filibuster but supported final passage.
Suddenly, the obligatory 60 votes to break the obligatory Republican filibuster seemed a pipe dream. So yesterday, the conference committee went back to work, with the very specific intent of appeasing Brown, Snowe and Collins. Which they think they have done in short order:
Congressional negotiators briefly reopened the conference proceedings on a sweeping financial regulatory bill on Tuesday after Senate Republicans who had supported an earlier version of the measure threatened to block final approval unless Democrats removed a proposed tax on big banks and hedge funds.
Conference negotiators voted to eliminate the proposed tax and adopted a new plan to pay the projected five-year, $20 billion cost of the legislation.
The new plan would bring an early end to the Troubled Asset Relief Program, the mammoth financial system bailout effort enacted in 2008, and redirect about $11 billion toward heightened regulation of the financial industry.
The conferees also voted to increase the reserve ratio of the Federal Deposit Insurance Corporation, but specified that small depository institutions — those with less than $10 billion in consolidated assets — be exempt from paying any increase.
They also voted to permanently set the maximum deposit insured by the F.D.I.C. at $250,000 per account, a change that would further raise the amount banks must pay toward the coverage.
Last time, 57 Democrats voted for cloture, and Brown, Snowe and Collins provided the last three votes to break the filibuster.
This time around, Sen. Byrd’s vote isn’t there. So either another Republican has to be enticed to vote against the filibuster, or one of the two Democrats who supported the filibuster have to be persuaded to step up.
For obvious reasons — mostly his own past behavior, which makes it hard for anyone on the Democratic side of the aisle to put much trust in anything he says — nobody is pinning their hopes on Chuck Snake-in-the-Grassley.
Russ Feingold has already made it clear that he has no intention of opposing the filibuster, and allowing the bill to come up for a vote, because a) he believes the bill is not as tough as it should be, and b) he believes that the perfect should jolly well be the enemy of the good.
Which leaves everyone looking at Maria Cantwell, who hasn’t committed herself one way or the other.
In fact, the whole strategy of killing the bank fee to buy the votes of Brown, Snowe and Collins seems to be predicated on the presumption that Cantwell can be persuaded or embarrassed into voting for cloture, even if she opposes the bill when it comes up for a majority vote.