Similar to the health care bill, financial reform promises to be a battle as well with giant banks like Bank of America (NYSE:BAC), JPMorgan Chase (NYSE:JPM), Wells Fargo (NYSE:WFC) and Citigroup (NYSE:C) ready to go to war.
The question probably isn’t so much whether a financial reform bill will pass, but more if the bill will have any meaning to it, or whether it goes too far.
Republicans are ready to battle against much of the existing bill – which was largely drafted by Sen. Chris Dodd (D., Conn.) – by adding possibly into the hundreds of amendments to it, making it something completely different than Dodd envisioned.
The bill needs 60 votes to pass, and seems to have 59 votes at this time. Some feel it can be passed at this time, but has to be put together with a version from the House before a vote can take place. Because of that, certain procedural barriers could be used to keep the vote in limbo, effectively keeping the vote from coming to the floor.
There are quite a few amendments to be added to the bill before it has a chance of passing, including getting rid of a proposed liquidation fund which would put the burden of costs on the banking industry rather than taxpayers. Another amendment would keep the bulk of the power with the Federal Reserve rather than the Federal Deposit Insurance Corp. This supposedly is because the FDIC is more strict in its regulatory role than the Federal Reserve is.
Some of the more costly parts of the bill are being battled against as well by the industry, who presumably would look bad because these ultimately would be passed on to the consumer, making it more costly to do business with the banks.
It will be interesting to see if there’s anything left to Dodd’s bill once the changes are made, and whether it’ll be better to start over from scratch with input from other lawmakers included in the process of writing the bill.
