Republicans–including moderates–are solidifying opposition to Democratic efforts to impose stricter regulations on Wall Street. They aren’t just attacking the Democrats’ financial regulatory reform bill as a vehicle that will lead to more bailouts. They’re also laying the blame for the lack of GOP support for reform directly at President Obama’s feet. And all the while, Republican leaders are seeking donations from major financial institutions ahead of the 2010 midterm elections.
“Right now the administration is saying ‘no’ to some common sense type of reforms that would strengthen financial services regulations and not affect small businesses in a negative way and allow for us to get a handle on the real problems in that industry,” said Sen. Scott Brown (R-MA), thought by many to be a potential swing vote on Wall Street reform. “Shame on the President.”
“I don’t think there’s any question but that the Dodd bill perpetuates the Too Big To Fail syndrome,” Sen. Judd Gregg (R-NH) told me in a brief interview in the Capitol this afternoon. “The bill still has serious problems, especially in the area of derivatives…there’s a lot of things that could be done that would be better and could be done in a bipartisan way.”
Gregg has been working with Sen. Jack Reed (D-NH) on compromise on derivative regulation, but says the White House won’t let it happen.
“It appears the White House has pulled everybody back from substantive negotiation,” Gregg added. “They want a political issue.”
“I don’t believe the Dodd bill that came out of the committee that we all opposed…would pass the Senate,” Sen. Richard Shelby (R-AL), the Republicans’ chief financial reform negotiator, told reporters off the Senate floor this afternoon. “I don’t know of any Republicans right now that would support it.”
At his weekly press conference today, Senate Minority Leader Mitch McConnell said he “naively” believed the White House was seeking a bipartisan bill, but said he now realizes the “White House goal is to have the most far-left proposal they can.”
“Make no mistake, this is a permanent taxpayer bailout of Wall Street,” McConnell added.
The hardened stance comes at a politically tricky moment, as McConnell is swatting away criticism for seeking to raise money from big financial institutions in exchange for extracting changes to key provisions of the bill.
According to Fox Business–hardly a hotbed of anti-GOP sentiment–McConnell and NRSC chairman John Cornyn met with leading Wall Street executives last week to ask for a bit of quid pro quo. “The Senators explained they can’t just oppose the Dodd bill — they need to come up with a reform plan of their own, as they fight its least free-market components, such as the notion that the government can determine which banks are ‘too big to fail,'” according to the report. “In the meantime, they need to increase numbers of Republicans in both the House and the Senate if they are going to make an impact on not just this bill, but other measures to increase Washington’s control of the financial business. To do that they need the support of the financial community. “
