As always, David Waldman has the best introduction to what’s going to happen this week in Congress. At 5pm the Senate will have a cloture vote to end debate on whether to have a debate on S.3217, the Restoring American Financial Stability Act of 2010. No one knows whether this cloture vote will succeed.
Typically you don’t see the Majority Leader moving things to the floor without some inkling that it’s going to work out in the end. At least not all that often. But the Senate is a little different from the House in that respect, since moving for reconsideration of a vote is a much more routine practice there. Senate Democrats also likely think this particular issue breaks down fairly well in terms of putting pressure on the Republicans blocking reform, such that repeated attempts at invoking cloture won’t be seen so much as a failure to lead as an illustration of Republican intransigence on behalf of public enemy #1: Wall Street tycoons who love to rip ordinary working people off and then wallow naked in their stolen retirement funds.
If the Democrats and the president were willing to frame the argument in Waldman’s style, this wouldn’t even be a fight. But most Dems and the president seem to lack the will to frame this is as an all-out battle of the people vs. the Wall Street tycoons. This allows the Republicans to muddy the waters by suggesting that the reforms don’t go far enough in breaking up the big banks. Consider Ranking Member of the Senate Banking Committee Richard Shelby’s performance yesterday on Meet the Press.
SEN. SHELBY: We’re going to continue to work today, as Senator Dodd said. I think we’re closer than we’ve ever been. And will we get a bill by tomorrow? I, I doubt it. I would always hope so because there’s so, so much involved. But I think we will get a bill. If the Democrats want a bill and will give us some things that we think that are substantive in nature, like make the “too big to fail,” send a message that nothing is too big to fail in this country and tighten up the language. There’s some flexibility in the language there that we’re talking about is–and…
…SEN. SHELBY: We need to tighten that up to make sure that it doesn’t happen. The message should be, unambiguously, that nothing’s too big to fail. And if you fail, we’re going to put you, put you to sleep…
…SEN. SHELBY: Well, that’s a, a good question, and that’s one that Dr. Volcker’s talked about for years. And he says if you’re too big to regulate, maybe you’re too big to, to exist, in other words, because you will cause systemic risk. Being big, in my judgment, is not necessarily bad. But it’s bad, bad when the perception is that the big is going to be bailed out and the small are going to be gobbled up by the regulators.
See a theme? So, the Republicans are suggesting that the bill to address systemic risk arising from failing firms that cannot safely be allowed to go bankrupt doesn’t address that risk at all. And, therefore, they’re going to filibuster it. The Democrats are not facing the charge that they’re being too tough on banks, but the opposite. So, with no pushback, they should be free to take shots at the most unpopular people in the world. But, for some reason, they want to be honest and say that the reforms are actually quite modest and not seen as all that unreasonable by most people on Wall Street. This isn’t how you get credit for taking on the banks. The Dems don’t have to be dishonest to point out that they’re trying to fix it so the evil greedy banksters can’t screw up the economy again (at least, not in the same way). Get tougher with these rogues.
