Friday, December 11, 2009

The Daily Strike-12/11/09-Regulated

Good evening and welcome to the Daily Strike. Today was yet another reminder how much better the country would be if we had a unicameral legislature. Let's get to it.

FINANCIAL REFORM: Yes, we made some bad compromises, and there are significant loopholes, but the House today passed the most significant financial regulation legislation since the New Deal. I described the bill in detail yesterday, but to recap, the bill for the first time regulates financial derivatives, creates a Consumer Financial Protection Agency, and has a provision that would allow the government to dissolve "too big to fail" companies in an orderly fashion. The House voted on a lot of amendments, including a Republican substitute. But I'm going to focus in on four incredibly important ones.

The first key vote was an amendment by Rep. Marshall (D-GA). This amendment would have added a provision allowing bankruptcy judges to renegotiate mortgages (known as cram-down). The provision had previously passed the House, but had been stalled in the Senate. Apparently, House members didn't want to take a tough vote on a provision that is DOA in the Senate. The amendment failed by a vote of 188-241. 4 Republicans voted yes, while a nauseating 71 Democrats voted no. (too many to list them!).

The next important vote was an amendment offered by Rep. Minnick (D-ID) that would have abolished one of the key provisions in the bill, the Consumer Protection Agency. This amendment was basically written by the financial industry lobbyists who feared an independent panel that would regulate dangerous financial instruments. Their allies in the House came close to stripping this provision, but luckily House Democrats rallied to defeat the Minnick amendment. The final vote was 208-223. Exactly zero Republicans voted against the amendment, while 33 Democrats voted for it. Here is the list of Democratic villains: Barrow (GA), Berry (AR), Bishop (GA), Boren (OK), Boucher (VA), Boyd (FL), Bright (AL), Chandler (KY), Childers (MS), Costa (CA), Cuellar (TX), Davis (TN), Griffith (AL), Herseth Sandlin (SD), Hill (IN), Kirkpatrick (AZ), Kratovil (MD), Markey (CO), Marshall (GA), Massa (NY), Matheson (UT), McIntyre (NC), Melancon (LA), Minnick (ID), Mitchell (AZ), Ortiz (TX), Rodriguez (TX), Ross (AR), Shuler (NC), Skelton (MO), Space (OH), Taylor (MS) and Teague (NM). Basically all of these are Blue Dog Democrats, who despite their fiscal prudence, apparently don't care too much about protecting the American taxpayer.

The third key vote was on the Republican motion to recommit, which would have ended the TARP bailout program by the end of the year. This is an amendment that would probably be popular to about 70% of the country, which is why the Republicans proposed it. Unfortunately, it would be a disastrous thing to do, especially as the economy is beginning to recover. We still need those funds to shore up the remaining bad banks, and more importantly, to direct to promoting jobs on main street. Every single Republican voted for this motion to recommit, as did 19 Democrats. The Democratic TARP-fearers: Bishop (GA), Boren (OK), Bright (AL), Chandler (KY), Childers (MS), Giffords (AZ), Griffith (AL), Halvorson (IL), Kirkpatrick (AZ), Kosmas (FL), Kratovil (MD), Massa (NY), McIntyre (NC), Minnick (ID), Mitchell (AZ), Nye (VA), Rodriguez (TX), Taylor (MS) and Teague (NM). These are a lot of the same members who voted to abolish the CFPA. It doesn't seem to make sense that they would do the financial industry bidding on CFPA, but vote against the very program that is keeping these institutions from collapsing. The one consistency: voting against the Democratic leadership!

The vote on final passage of the bill was 223-202, with a familiar list of 27 Democrats voting no: Berry (AR), Boren (OK), Boucher (VA), Bright (AL), Chandler (KY), Cuellar (TX), Edwards (TX), Griffith (AL), Halvorson (IL), Hill (IN), Kaptur (OH), Kirkpatrick (AZ), Kucinich (OH), Massa (NY), McIntyre (NC), Ortiz (TX), Perriell0 (VA), Schrader (OR), Skelton (MO), Space (OH), Stupak (MI), Taylor (MS), Teague (NM) and Visclosky (IN). Kucinich and Kaptur voted no because they thought the regulations didn't go far enough. Interestingly, Minnick, the sponsor of the anti-CFPA amendment, voted for the bill.

Even though the bill has some gaps, it marks a significant victory for progressives, and a major victory for President Obama. The President predicated much of his economic policy on reigning in the excesses of Wall Street, and this bill goes a long way towards achieving those ends. The Big Picture sums it up nicely:

Well, that is great that they're going to keep the consumer protection agency! Great substantively, and also good that we could win that battle. Good work by the White House getting that done. Got to celebrate our victories when they come. And this is actually a pretty big one, considering where things are now and have been - the last measure regulating Wall Street, not DEregulating it, was probably passed before the Lost Period. Good stuff.

Now we sit and wait for the United States Senate. It's starting to sound like a broken record.

THE SENATE: Speaking of the Senate, the upper chamber was in session today, although there was virtually no news on the health care front. Majority Leader Reid (D-NV) is still waiting on a cost estimate of his "compromise" from the Congressional Budget Office. Senators were trying to force a vote on an amendment that allows for the importation of prescription drugs from Canada. This is a good amendment that has bipartisan support. Unfortunately, the White House made a bunch of promises to the pharmaceutical industry to try and keep them on the sidelines during the health reform debate, and opposing this amendment was one of them. Senator Carper (D-DE) is holding up the amendment. I hope they will break through and vote on it in the coming days.

The Senate is currently considering the Omnibus Appropriations bill, which combines 6 of the 12 annual spending bills. The House passed the conference report yesterday. Since the conference report contains provisions that were never passed by the Senate, Senators had to vote on a motion to waive some budget rules. Waiving rules requires 60 votes. The motion carried by a vote of 60-36. Republicans Cochran (MS) and Collins (ME) voted yes, while Democrats Bayh (IN), Feingold (WI) and McCaskill (MO) voted no. Senators will vote tomorrow to end debate on this conference report, and will most likely vote to send the bill to the President on Sunday, at which point most government agencies will be fully funded through September 30, 2010.

The President was en route back from Oslo, so he didn't make much news today. We'll keep you posted this weekend on what happens with the health care debate, and anything else newsworthy. Have a good night, and happy financial regulation!

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