Before you read this article please note WHO proposed the amendments and what how the vote turned out to pass these amendments…I think a lot of people in this country need to look behind the curtain.
Senate Ends Taxpayer-Funded Bank Bailouts
by: Patricia Murphy
The Senate made two significant changes to the Wall Street reform bill Wednesday, including a ban on using taxpayer money to salvage failing financial institutions.
The amendments followed a breakthrough in negotiations between Democratic and Republican leaders.
The first amendment came from Sen. Barbara Boxer (D-Calif.), who proposed banning federal funds from being used to bail out large financial institutions. Boxer called her amendment “an ironclad assurance that if a failing Wall Street firm is liquidated, the cost of that liquidation must come either from selling off the firm’s assets or from assessments of big Wall Street firms.” The Senate passed it 96 to 1, with Sen. Jon Kyl (R-Ariz.) objecting.
Next up was a joint amendment from Sens. Chris Dodd (D-Conn.) and Richard Shelby (R-Ala.) prescribing an orderly disposal of firms deemed “too big to fail.” Their measure would give the Federal Deposit Insurance Corp. (FDIC) the power to seize and liquidate large financial firms if their failure would pose a risk to the U.S. economy.
The last-minute compromise hammered out between Dodd and Shelby came after Republicans refused for days to go along with Dodd’s original idea. He proposed creating a $50 billion bailout fund, paid for by banks, to use in case liquidation of large firms becomes necessary. Senate Minority Leader Mitch McConnell called the proposal a “permanent bailout fund,” while Maine Republican Susan Collins warned that institutions engaged in risky behavior would have a government safety net.
The Senate passed the Shelby-Dodd measure, 93 to 5.
The near-unanimous votes came after weeks of partisan bickering by senators in both parties, with each side accusing the other of working to help Wall Street at the expense of small businesses and taxpayers.
Republicans argued that under the Dodd plan, any business that extends credit to its customers could be subject to the measure’s regulations. On Tuesday, McConnell warned it would give the federal government regulatory authority over businesses that are not financial institutions. “It has an extraordinarily broad reach at the moment, that could go right down to an orthodontist in middle America providing credit for a family having their child’s teeth straightened,” McConnell said.
But Democrats maintained that it would apply only to firms that make extending credit a core business.
At a press conference Wednesday, Senate Majority Leader Harry Reid alleged that any Republican objection to the overall reform bill is meant to protect Wall Street.
“Republicans are having difficulty determining how they’re going to continue making love to Wall Street,” Reid said. “It’s obvious they don’t want to put any decent restrictions on what Wall Street has done or is doing.”
With two roll call votes down, and more than 90 amendments still pending, Dodd predicted Wednesday that debate on financial reform will last at least through the end of next week.