Senate gives Thumbs Up to Financial Regulation Reform
Views are quite divided across party lines on the financial overhaul bill.
Republicans want some amendment in the legislation in front of the Senate. And, as President Obama gears up to sign the healthcare reform bill, the Democrats now have shifted their focus on the other legislation. The democrats want a sweeping overhaul of financial regulation.
Treasury Secretary Timothy F. Geithner stated that the discussion was reaching "a defining moment" as the Senate Banking Committee is trying to put thumbs up on the legislation as the party-line vote stands on 13-10. It is quite similar to the one the House passed in December which was passed without a single Republican vote.
"We are now one step closer to passing real financial reform that will bring oversight and accountability to our financial system and help ensure that the American taxpayer never again pays the price for the irresponsibility of our largest banks and financial institutions," President Obama said.
Meanwhile, the legislation would have a great impact on the financial regulations and sweeping changes are expected. Some finer points are, an agency will be created to save the consumers in the financial marketplace. Then a council of regulators will be formed to look after the economy for signs of major risk. Any firm which poses a danger to the economy would be seized and dismantled by the government. This new legislation will also impose regulations on hedge funds and complex financial derivatives.
The overhauling of financial sector and brining in a new legislation is on the priority list of the Obama government. Before the midterm elections, White House is also trying to get an approval for this bill so that a crisis situation can be averted.
"The stakes are too high -- and the American people have suffered too greatly -- for us to fail in this effort," said Senate Banking Committee Chairman Christopher J. Dodd (D-Conn.), who drafted the legislation with bipartisan input. "And we will not fail. We will have reform this year."
Although the House Bill and the bill put forth by Dodd differ but Obama’s administration had some main issues as it is trying to make an altogether new consumer agency. The White House wants to pass the bill before this year’s legislative calendar comes to a close.
Although, Republicans who were there on the banking committee didn’t vote for the bill, Sen. Richard C. Shelby said he was hopeful of a compromise formula being reached. The spring recess starts next week and Dodd had asked the Senate to move the bill before he leaves Washington.
Shelby said Republicans decided not to take out the committee vote with a slew of amendments which shall most likely be voted down by the Democrats. Instead, the Republicans should make sure that the legislation gets amended before the full Senate. Unlike the healthcare bill, the Republicans have majority of votes in the Senate to stop the legislation, which will require at least the support of 60 senators to pass.
Shelby said the bill is better than the previous version which Dodd had come up with. But Shelby said there were some grey areas which needed some changes, such as limiting the government's ability to engage in future bailouts.
"Although I have raised a number of serious concerns, I remain optimistic that we can, over time, reach an agreement that will garner broad bipartisan support," Shelby said before the vote. "I just don't believe we are there yet."
The new consumer protection agency is something which is getting the flak from the
financial industry, but Geithner urged lawmakers not to get disturbed.
"Listen less to those whose judgments brought us this crisis. Listen less to those who told us all they were the masters of noble financial innovation and sophisticated risk management," Geithner said in a speech to the conservative American Enterprise Institute.
"Instead, listen to the families and businesses still suffering from this crisis." He added.
However, Dodd does face a huge task of passing the bill through the Senate. Not only he must have votes of the Democrats but he must also try to gain Republican votes and make sure it goes unopposed.
