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Dodd to Unveil Financial Overhaul Bill, No GOP Support

Source: WSJ

Posted on 11 Mar 2010

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Senate Banking Committee Chairman Christopher Dodd (D-CT) will introduce his sweeping plan to overhaul financial regulations Monday without any Republican support, a spokeswoman said, potentially imperiling the White House's effort to redraw financial regulations.

Mr. Dodd is still hopeful his negotiations with a Republican on his panel, Sen. Bob Corker of Tennessee, can be worked out and that they will be able to bring a bipartisan bill to the Senate floor, the spokeswoman said.

Both lawmakers have said in recent days they were close to a deal, but Mr. Dodd decided Thursday morning he had to introduce a bill as soon as possible. People familiar with the matter said negotiations had been in progress through Wednesday afternoon.

Mr. Corker said he will continue to work with Mr. Dodd but called the move "very disappointing."

"Our talks will continue, and it is still our hope to come to agreement on a strong bill all of the Senate can be proud to support very soon," Mr. Dodd said in a written statement.

Introducing the bill Monday will allow Mr. Dodd to hold a vote in his committee before the Easter recess in early April. If Messrs. Dodd and Corker can resolve their differences in the next week, they could offer amendments to Mr. Dodd's bill and create a more bipartisan product.

But if their differences aren't settled, the vote in Mr. Dodd's committee could fall along party lines, making it difficult for Democrats to break any filibuster on the Senate floor. Democrats only control 59 votes in the Senate, and 60 are needed to overcome a filibuster. Mr. Dodd has said he doesn't want to go to the Senate floor "begging for a 60th vote."

Mr. Dodd's own deadlines for introducing a bill have slipped in recent weeks as talks with Mr. Corker dragged on longer than expected. Mr. Dodd said last week on the Senate floor he was optimistic he could get a deal but described the process as "fragile." Some Senate Democrats, and even Obama administration officials, have pushed Mr. Dodd to go ahead and introduce legislation, even without Mr. Corker, to force the issue.

Many Democrats feel they shouldn't offer too many concessions to Republicans in the bill and should instead force Republicans to take difficult votes against consumer protections and tougher curbs on Wall Street.

Lawmakers have wrangled over provisions in the bill, including consumer protection, bank regulation, the role of the Federal Reserve, and oversight of derivatives. Most recently, Democrats and Republicans on the panel have clashed over what types of investor protection and corporate governance rules should be in any new bill and Senate aides described this as a sticking point over the past few days.

Several Republicans have complained the legislation Messrs. Dodd and Corker were working on was too punitive toward businesses and would restrict the flow of credit through the financial system. Among other things, it would increase regulation for a range of financial companies, create more restrictions for the types of financial products that can be offered, and force more transparency over exotic financial instruments such as derivatives.

When Messrs. Dodd and Corker appeared close to a deal last week, Mr. Corker was called into a meeting with Senate Minority Leader Mitch McConnell and other senior Republicans. Mr. Corker was pressed for details of any potential compromise, and he left that meeting asking Mr. Dodd to change the way consumer protection rules would be constructed.

Mr. Dodd's announcement is the latest twist in what has become a long, legislative saga. Mr. Dodd several weeks ago broke off talks with another Republican, Sen. Richard Shelby of Alabama, after declaring the two had reached an impasse. Within days, he had begun negotiating with Mr. Corker, a more junior member of the committee.

The House of Representatives passed a financial overhaul package in December, but it didn't receive any Republican support and two dozen Democrats voted against it.