Yesterday, the Washington Post reported that aides to Sen. Richard Shelby (R-AL), the ranking Republican on the Senate Banking Committee, said that Republicans were likely to introduce an alternative financial reform bill as they continued to block Sen. Chris Dodd’s (D-CT) bill. “We have been drafting an alternative approach since the very beginning,” said one staff member. “It may come to the point where Republicans decide, ‘Let’s just put out specifically what we’re for.’ That decision hasn’t been made yet.”
Last night, an overview of the GOP’s proposal was released (the draft was not attributed to any individual senator). Asked about the proposal on CNBC this morning, Sen. Bob Corker (R-TN), who has been negotiating with Democrats on Wall Street regulation, said he didn’t know what the “purpose” of the GOP’s alternative was:
HOST: How hot are you on the Republicans’ alternative proposal?
CORKER: I — look, I’m not sure what the purpose of it is, to be candid. It’s, I’m not going to spend a lot of time on it. I think I understand and I think everybody else does that the bill that’s moving is the one that will be on the floor and what is it that we can do to try to get it in a place that we don’t, in the name of driving a message, basically mess up the capital markets in our country that manufacturers and people throughout the heartland of our country use to make great companies.
Corker then suggested that the GOP proposal was just “messaging,” saying, “I try to stay out of the messaging. I try to stay out of the politics of it all.” Watch it:
Indeed, as the Wonk Room’s Pat Garofalo observes, the GOP alternative undermines the “perpetual taxpayer bailout of Wall Street banks” rhetoric that Republicans like Senate Minority Leader Mitch McConnell (R-KY) have been using to attack Dodd’s bill. “Republicans either also want to implement permanent bailouts, or they are acknowledging that their meme was complete bunk, as their alternative mirrors Dodd’s language when it comes to unwinding failing financial firms,” writes Garofalo.
Also noting the GOP bill’s general similarity to Dodd’s, Matt Yglesias points out that one major difference is “what it does to consumer protection.” “On the one hand, it seemingly weakens the independence of the consumer regulator,” writes Yglesias. “On the other hand, it has the consumer regulator preempt any and all state regulations. This is a helpful reminder that nobody on the right actually gives a damn about federalism except as a tool to advance conservative substantive policy—federal preemption of strong state regulation is always welcome.”