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May 20, 2010 Thursday 04:37 PM EST
Senate Democrats Win Major Financial Reform Vote, Final Approval Likely
Jesse A Hamilton
U.S. Senate Democrats rounded up the minimum number of votes they needed to push the enormous financial reform bill past what may have been its final major barrier. In the 60-40 procedural vote, the Democrats have blocked the Republicans’ chance to filibuster, meaning the far-reaching bill can soon be approved with a simple majority vote.
The “cloture” vote on the Restoring American Financial Stability Act of 2010 limits the remaining debate to 30 hours, meaning the Senate’s final vote on the bill could come as soon as that clock runs out. In the meantime, though, Senate Majority Leader Harry Reid said there are a couple of amendments “we have to figure out a way to resolve.”
“We’re going to try to work through this,” Reid said after the vote, saying that “in the best of all worlds” the Senate could finish it up quickly and move on to other matters.
Insurance lobbyists have been relieved that, after months of effort, the industry was largely left out of new regulatory systems within the bill, including the new consumer protection bureau. But the industry would be directly affected by a potential new Office of National Insurance — designed as a federal hub for insurance information, though it would be given no direct regulatory authority. And there is still some possibility that the largest insurers could be folded into the group overseen by a new systemic risk regulator.
Another insurance provision — which attracted little attention among the big-ticket items of the bill — included language from the Nonadmitted and Reinsurance Reform Act that would reform tax remittance and regulation of multistate surplus lines transactions. Because it appears in both the House and Senate bills, it’s likely to survive until a potential presidential signature, which is a result cheered by the National Association of Professional Surplus Lines Offices. “This is an issue NAPSLO, and the industry, has worked on for many years, and we are glad to see the language included in the bill,” said Executive Director Richard Bouhan, in a statement. “Senate approval of the language is a giant step toward achieving needed reforms of surplus lines regulation.”
This success for Democrats — including for President Barack Obama, who had held this effort out as one of his top policy priorities — follows a misstep the previous afternoon, when a similar attempt to pass cloture ended in an unexpected 57-42 loss after a pair of Democratic senators voted no in protest of elements of the bill they wanted strengthened (BestWire, May 19, 2010). Those same members again voted no, but an additional Republican vote switched to the yes side, bringing the number to 60 with the GOP votes of Maine Sens. Olympia Snowe and Susan Collins in addition to Sen. Scott Brown from Massachusetts. Brown — who had been accused the day before by Reid of backing out on a promise to vote yes in that first cloture vote — said in a statement that he voted yes because he “received assurances” from Reid that his objections to elements of the so-called Volcker Rule would be addressed.
“This has really been a good debate,” Reid said, though he added he wished more Republicans could have joined with those approving the bill, which Democrats call the “Wall Street reform” bill. “I think it’s the way the Senate should operate more often than it has.”
A similar reform bill passed in the House six months ago, but the Senate debate stretched over many additional months. It’s not yet clear, though, what the House Democratic leadership will do in response to the approved Senate bill. House leaders have the option of taking it into a conference committee between the two chambers, where differences would be hammered out through negotiation, and the eventual compromise bill would have to return to both the Senate and House for final votes. Or, the House has the option of approving the Senate’s version as-is and sending it to the Oval Office for enactment.
(Jesse A. Hamilton, Washington bureau manager: Jesse.Hamilton@ambest.com)
May 21, 2010