With Full Roster, Democrats Hope to Advance Financial Overhaul
Senate Democrats face the daunting task of rescuing their overhaul of financial regulations Thursday by persuading someone to switch votes.
Internal Democratic discontent over the financial regulatory overhaul bill resulted in a filibuster Wednesday, with Majority Leader Harry Reid (D-Nev.) falling two votes short of the 60 needed to close down debate on the measure, which has been on the floor for nearly four weeks.
Defections on both sides of the aisle canceled each other out, with Sens. Maria Cantwell (Wash.) and Russ Feingold (Wis.) defying the Democrats to join all but two Republicans — Maine Sens. Olympia Snowe and Susan Collins — to sustain a filibuster of the measure Wednesday afternoon. The vote denied the Democratic leadership a crucial legislative victory on an issue that it has sought to use as a bludgeon against Republicans.
To preserve his right to revisit the vote, Reid also voted “no” on the 57-41 vote. Reid said he hoped to vote again Thursday, but it was unclear what steps he was taking to ensure a different result.
“We want good, strong, thoughtful reform,” Sen. Charles Schumer (D-N.Y.) said after the vote. “The bill had it. If we would’ve voted for cloture, we would’ve had it, but we’ll come back tomorrow and we’ll fight another day.”
Assuming Sen. Arlen Specter (D-Pa.), who lost his primary election Tuesday, shows up for work Thursday and votes for cloture, Reid only needs to persuade one Senator to flip-flop.
Reid indicated Wednesday that he would have had that vote if one Republican Senator had not changed his mind and voted for the filibuster. “A Senator broke his word with me,” he said.
Though Reid did not identify the Republican, Democratic sources suggested it was Sen. Scott Brown (Mass.).
However, the political newcomer dismissed claims that he misled Reid.
“He didn’t vote for cloture today because the way this bill is currently constructed would cost jobs in Massachusetts and does not include the fixes he understood were in the bill. He made that clear before his vote and after,” spokesman Colin Reed said in a statement.
Brown, in a separate statement, did not close the door to voting for the bill at some point. “My vote today is not a vote against financial regulatory reform. I believe that we need to enact measures that will prevent another catastrophic collapse of our financial system,” he said.
Brown added: “My constituents sent me to Washington to look out for their priorities first and foremost, and I cannot in good conscience vote to end debate on a flawed bill. I will continue to work in a bipartisan fashion in the days ahead to improve this bill for my state and my country.”
Sen. Bob Corker (R-Tenn.) did not mention Brown by name, but he indicated that Republicans who were on the fence decided to oppose the bill when Cantwell and Feingold voted against cloture.
“I’m pretty certain that two Democrats voting against cloture changed the dynamic on the floor. In fact, I’m more than certain about that,” he said.
While Republicans largely said the bill would overregulate community banks and drive some financial markets overseas, Cantwell and Feingold opposed cloture because they believe the bill is not strong enough to prevent banks from engaging in the type of risky behavior that led to the financial industry meltdown of 2008.
Cantwell said the bill has a loophole that will allow derivatives swaps to avoid regulatory scrutiny, and she demanded a vote on an amendment to close that gap.
“I have been there [on the floor] since 9:30 this morning saying this was an issue,” she said after the vote. “There’s lots of amendments I’d like to offer in addition, but this one is so critical … that I couldn’t see moving toward cloture without getting a vote on it.”
Cantwell said neither the leadership nor Banking Chairman Chris Dodd (D-Conn.) explained why her amendment was not given a vote on the floor. She said she would not vote for cloture Thursday if her proposal does not see floor action.
Feingold, meanwhile, had been largely silent for much of the debate on the bill, but he put out a statement noting that he opposed the $700 billion financial sector rescue in 2008 and the 1999 repeal of Depression-era laws that struck down barriers between banks, insurance companies and securities firms.
“The test for this legislation is a simple one — whether it will prevent another financial crisis,” Feingold said. “As the bill stands, it fails that test. Ending debate on the bill is finishing before the job is done.”
Other Discontented Democrats
Cantwell and Feingold weren’t the only Democratic agitators. Several Democratic Senators were still withholding their votes as of Wednesday morning in order to secure votes on their amendments, and several besides Cantwell camped out on the Senate floor during the day.
Sen. Sheldon Whitehouse (R.I.), however, received a promise to vote on his proposal to let states regulate credit card rates that are marketed in their borders. The amendment was defeated later Wednesday night. Meanwhile, Sens. Jeff Merkley (Ore.) and Carl Levin (Mich.) found a way to offer their bank proprietary trading ban to another germane amendment that was already pending.
Whitehouse indicated that, despite the loss, Wednesday’s vote helped Democratic leaders find out where the votes were among Democrats and Republicans.
“It’s one thing to talk, and it’s another thing to actually vote. And I’m not actually clear how people were on how the votes were going to be on the Republican side either,” Whitehouse said. “It’s clarified everything now for the leadership to move toward cloture.”
Whitehouse said White House officials “are going to get more engaged” to help push the bill.
Reid and other Democrats tried to downplay the high-profile Democratic defections, saying Republicans are to blame for the failure of the vote.
“It would be pretty easy to write a story that basically 57 of the 59 Democrats voted to move forward on this legislation, and it’s pretty easy to write a story that 39 of the 41 Republicans voted against it. It’s pretty simple math,” Reid said when asked about the lack of Democratic unity.
But he said he appreciated the votes of Snowe and Collins in favor of moving the bill to final passage.
Corker added that Reid secured Snowe’s vote with a promise to vote on her amendment to address small-business concerns in the bill.
Republicans largely stood together in voting against cloture Wednesday, one day after electoral primaries in Arkansas and Pennsylvania seemed to shift a general election trend in their favor.
Specter, who left the Republican Party last year and was the Democrats’ establishment pick, was defeated in the Keystone State. Meanwhile, Sen. Blanche Lincoln (Ark.), who authored a key component of the financial reform bill as chairwoman of the Agriculture Committee, was unable to win a majority of votes in her state to avoid a runoff election now set for June 18.
Still, Levin suggested the political winds would swing to the Democrats’ favor in regards to financial reform.
“The reaction of the American public was so negative to the Republican filibuster to Wall Street reform that they backed off the filibuster,” he said, recalling last month’s floor drama to bring the sweeping measure up for consideration. “I think one or more Republicans will not want that kind of heat to be applied to their party.”