In the last two days, three of the four Republican senators who voted for their chamber’s version of financial regulatory reform legislation — Sens. Olympia Snowe (R-ME), Susan Collins (R-ME), and Scott Brown (R-MA) — have expressed reservations about the final bill crafted by the House-Senate conference committee. They’ve keyed upon a $19 billion fee that would be levied upon the biggest financial firms, to cover the cost of the legislation’s implementation, as a reason for their new-found doubts.
Brown today even officially said that, should the fee remain in the bill, he would vote against it. “I am asking that the conference committee find a way to offset the cost of the bill by cutting unnecessary federal spending,” he said.
Administration officials said Democrats seemed to be coalescing around a push to drop the bank tax and to replace it with a provision to end the Troubled Asset Relief Program months short of its scheduled Oct. 3 expiration. Doing so would leave some money available that would help offset the cost of the financial regulatory bill. Lawmakers were also said to be negotiating yet another increase in the fee that banks pay to the Federal Deposit Insurance Corporation, though details had yet to be worked out.
Before getting into the politics of this mess, it’s worth remembering what the spat is about. As Kevin Drum noted, the bank fee is “not there to punish banks or to create a slush fund for new spending. It’s there solely to make the bill deficit neutral.” What the Senate Republicans are saying is that they’d rather raid the budget elsewhere than raise taxes on the very biggest financial firms, which benefited tremendously from federal intervention during the financial crisis. Remember, this fee amounts to 0.01 percent of GDP over the next decade.
The ability to get the financial reform bill through the congress has obviously been complicated by the GOP’s intransigence and the passing of Sen. Robert Byrd (D-WV). Sen. Russ Feingold’s (D-WI) announced opposition doesn’t help matters. I’m sympathetic to the view that Democrats should remove the concessions Brown won in the final language and insert language that would bring Sen. Maria Cantwell (D-WA), who voted against the bill in the Senate, around to supporting it, instead of removing the bank fee. But that still doesn’t get you from 57 to 60 votes.
What I can’t understand, however, is why no attempt to pass the bill as is will seemingly be made. As David Dayen put it, Democrats “could dare Republicans to filibuster a Wall Street reform bill over and over, putting them squarely in opposition to public opinion.” Back in April, just the threat of the Democrats pulling out the cots and camping in the Senate all night to pass an unemployment benefits extension was enough to get the GOP to drop its opposition. Doesn’t this call for a repeat performance?