About a week or two. That’s how long Republicans have to decide how they ultimately want to play their hand on financial regulatory reform. According to numerous Democratic aides and key senators, the GOP will either have to join forces with Democrats on a bill that hews very much to the White House’s demands, or they’ll have to do their best to block a bill that enjoys wide popularity. But as much as Democrats want to change the rules that govern Wall Street quickly and smoothly, they also love the politics of moving the bill forward without GOP support and letting Republicans publicly justify their decision to protect hated financial institutions from the regulations they oppose.
“We are ready to go forward. The bill’s ready…if I have to go it alone, I’ll go it alone…. I’m ready to go to the floor tomorrow if they want.” said Senate Banking Committee Chairman Chris Dodd last night, after a brief meeting with his counterpart, Sen. Richard Shelby (R-AL).Aides go further, admitting that they’d relish the prospect of putting Republicans on the side of big banks in opposition to reg reform.
In stark contrast to their approach to the year-long fight over health care reform, Democrats now say broad bipartisan agreement isn’t worth it if it sucks up too much time, and needlessly weakens the bill.
“Having an agreement that at the end of the day would largely have no teeth…would be a sham,” DSCC chair Robert Menendez told reporters yesterday, off the Senate floor. “If you just want bipartisanship for a figleaf, I think that would be a huge mistake on a policy basis, and a huge political mistake as well.”
“This is not going to be a repetition of the health care [debate],” Dodd said last night. “That was one of the biggest mistakes ever made, in my view–people waiting around, praying and hoping, day to day, that someone might show up and be supportive of the view.”
Senate Majority Leader Harry Reid will ultimately decide when to move ahead, and aides say he’ll likely try to take up Dodd’s bill after next week, during which he hopes to confirm some of President Obama’s pending nominees.
At that point, if an agreement isn’t reached, the Republicans will have to make a tough decision. They can either enter a public fight over the bill on the Senate floor, or they can band together and block Democrats from even bringing the bill up for debate. And there, too Democrats think they have the political upper hand.
“I can not imagine how foolishly you would position yourself in the eyes of the American public, after what they’ve been through, that you will not even debate your amendments that you care about on a bill of this importance,” Dodd said when I asked him whether he expected Republicans to filibuster the motion to begin debate. “To me that would be condemning themselves to the fury of the American people. I can’t imagine they would allow that to happen.”
Assuming a few Republicans peel off, and allow debate to begin, the bill will stay on the floor until there are, again, 60 votes to end debate. There will be votes on amendments, including, most likely, GOP poison pills, forcing Democrats to take tough votes. But if Democrats stick to their guns, Republicans will have to again decide whether its wise to sustain a filibuster of financial reform.
Republican leaders hope that, over time, their political message–that Dodd’s bill institutionalizes bailouts–will take hold, and the public will turn against the bill. But that spin campaign got off to a rough start this week. And with the general principle of imposing stricter rules on Wall Street still broadly popular, they’ll have a tough time making inroads.