Democrats Scramble to Save Financial Reform Deal

Posted June 29, 2010 at 11:02am

Democrats worked Tuesday on changes to their imperiled financial services reform deal after it became clear that they were short on votes for the package in the Senate.

House Financial Services Chairman Barney Frank (D-Mass.) said his chamber will wait for Senate Democrats to negotiate changes needed to lock down 60 votes for a Wall Street reform bill before taking action on the measure.

Also Tuesday, Sen. Scott Brown (R-Mass.) announced he would not vote for the financial reform conference report agreed to last week by House and Senate negotiators. Brown voted for the Senate version of the bill, and supporters of the legislation had hoped he also would support the conference report.

Leaving a meeting with Speaker Nancy Pelosi (Calif.) and other top House Democrats on Tuesday morning, Frank said Senate Banking Chairman Chris Dodd (D-Conn.) was “having some last-minute conversations” to nail down the 60 votes needed for the Senate to thwart a GOP filibuster of the bill.

The Monday death of Sen. Robert Byrd (D-W.Va.), coupled with opposition from Sen. Russ Feingold (D-Wis.) and wavering support from two key Maine Republican moderates has left Dodd short of the votes needed to pass a version of the conference report that was hammered out late last week.

“We’re waiting to hear,” Frank said, adding that the “only issue” still in play was a $19 billion levy on banks and hedge funds that was added to the bill in conference and has turned off some Republicans who initially supported the measure.

“There’s nothing else,” Frank said, adding that it was more likely the $19 billion pay-for would be revamped rather than dropped altogether. It was not clear how broadly the offset might be changed.

Frank said he was willing to wait for changes negotiated in the Senate because he wanted “to send a bill to the president, not just pass a bill in the House.”

House Majority Leader Steny Hoyer told reporters said he still expected the regulatory reform bill to come to the floor this week but that he too wanted to give Dodd time to negotiate support in the Senate.

However, the Maryland Democrat stopped short of ruling out the possibility that the House would act, even if the Senate outcome was still unclear.

“We may well take it up whatever the situation in the Senate is,” Hoyer said.