Another try for bipartisan bank bill after GOP blocks Dems' plan 

Senate Republicans, along with one Democrat, voted to block a bill to overhaul the nation's financial system and create new layers of government oversight.

It was a major show of unity for Republicans, who believe the bill imposes overly burdensome regulations and would institutionalize government bailouts.

But Democrats plan to keep the heat on Republicans in the coming days by calling repeated votes to proceed to the bill, even as the two sides meet to work out their differences.

"We remain open to working with our Republican colleagues, but we will not tolerate efforts to slow-walk this process or water down this reform because it is too important to middle-class families in Nevada and across America," said Senate Majority Leader Harry Reid, D-Nev., who is fighting a tough re-election battle.

Reid accused Republicans of "voting to protect the big banks and their bonuses and to keep this important debate hidden from public scrutiny."

Republicans held together despite these repeated accusations from Democrats as well as polls showing the public is largely in favor of reforming Wall Street.

"It's clear that they are trying to score political points instead of just doing the people's business," Sen. Scott Brown, R-Mass., said of the Democrats. "People want this area addressed."

Both Democrats and Republicans will now resume negotiations in private on a compromise bill that can attract at least a few GOP votes.

"We continue to try and put a bill together," Sen. Richard Shelby, R-Ala., the top Republican on the banking committee, said after the vote. Shelby said he would like to reach an agreement "in the next few days," but "it depends on give and take."

The bill as currently written would give the federal government new powers to wind down big financial institutions that fail and would establish a $50 billion fund to settle accounts, though Republicans argue it does not preclude a taxpayer bailout from taking place. The bill would also create new trading regulations and establish a consumer protection agency.

The motion to proceed to debate on the bill was defeated by 40 Republicans and Sen. Ben Nelson, D-Neb., who said he feared provisions in the bill aimed at regulating big financial institutions would have the unwanted effect of stifling small banks and businesses such as dental offices that allow patients to spread out payments.

Nelson's fears are shared by moderate Republicans including Sen. Olympia Snowe, of Maine, so it is likely Democrats will have to change the language to address the issue, in addition to the other problems Republicans have with the bill.

Republicans are also preparing to offer their own financial reform bill if a compromise cannot be reached, top GOP aides said Monday.

But Shelby, who is working closely with banking committee Chairman Christopher Dodd, D-Conn., said Republican legislation would not yet be offered.

"We will at the right time, but what I'm working toward is a bipartisan bill right now," Shelby said.

sferrechio@washingtonexaminer.com

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