Still no deal on Wall Street reform

by: Chris Bowers

Wed Jun 30, 2010 at 10:12

By stopping additional payments from the Troubled Asset Relief Program a little more than three months before it formally ends, the proposal would save $11 billion. That would cover most of the projected $19-billion cost of the reforms over 10 years. (...)

To cover the remaining cost of the reform package, Dodd's plan also would increase the premiums that banks with more than $10 billion in assets pay for federal deposit insurance, administered by the Federal Deposit Insurance Corp.

A $19 billion tax on banks would have been better policy, both because it provided a long-term funding source and because it would have reduced the concentration of power and wealth of the big banks.  Still, on the bright side, getting almost every Republican to vote against ending the bailout, in the form of TARP, should have significant political benefits.  Every Republican conferees voted against ending TARP yesterday, for starters.

Even with this change to the bill, the 60 votes needed for passage this week have not been secured.  It is believed that Collins and Snowe will support the bill now.  However, Scott Brown and Maria Cantwell are still maybes.  Unless both of them come out in support, then the bill cannot pass this week.  Unless one of them comes out in support, then the bill cannot even pass in two weeks, when Robert Byrd's replacement will be sworn into the Senate.  Republican Chuck Grassley of Iowa is another potential vote.

Speaking of Robert Byrd, his funeral is on Friday.  It will be attended by numerous Senators, meaning that there will not be any chance of getting 60 Senators to vote for cloture that day.  Thus, cloture would have to be achieved by late tomorrow in order for the bill to pass this week.

So, how soon the House passes the bill (it is expected to do so today, but every hour matters now), and what public statements we hear from Cantwell, Scott Brown, and Grassley mean a great deal.  If the conference report on the bill is not passed through both chambers before Friday morning, it will require a vote when the Senate returns from 4th of July recess.  Bank lobbyists and the tea party will use this time to aggressively attack the bill at townhalls around the country, thus potentially shaking loose a couple of votes and putting it in danger once again.

It ain't over 'till its over. That is just as true on Wall Street reform as it was on health insurance reform.

Update: Brown is going too let the bill stew over the 4th of July recess.  In a statement he just released:

"Over the July recess, I will continue to review this important bill," Brown said in a prepared statement.

Grrr.  Unless both Grassley and Cantwell come out in support, this fight is going for another two weeks.