Republicans and Democrats were left picking up the pieces of financial reform after efforts to bring it to a floor debate were blocked with a 57-41 vote Monday.
It only looks like Republicans are on the defensive — after all, they blocked the vote with help from one Democrat, Sen. Ben Nelson of Nebraska, who voted, reportedly, with one constituent in mind, the Sage of Omaha, Warren Buffett.
It shows how personal some of the debate has become. Reportedly, the billionaire investor wanted to ink out currently held derivatives from the legislation, saving himself a bundle on how much he would need to put aside as a cushion against derivative trading losses.
Such a move would presumably make the bill palatable to far more players than just Warren Buffett. But, it was scratched in negotiations during the weekend, so Nelson, who approved the derivatives measure in the Agriculture Committee vote last week, changed his tune. At least for the time being.
Senate Majority Leader Harry Reid also voted no, a step that allows him to bring the procedural vote up a second time, possibly as early as Tuesday, The New York Times reported.
The delay has both the advantages and disadvantages of allowing more constituents time to step forward, or at least have their moment in the media, if not in the halls of the U.S. Senate.
Who to pencil in; who to scratch out? What’s the difference between diluting a bill and preventing a one-size fits all mandate from harming enterprises that have done no harm to others?
The Times said candy manufactures were concerned the bill could limit their derivative trading, which is used to hedge against rising commodity prices — sugar, not to put too fine a point on it. Will Mars have to put together an enormous cushion to place bets that protect themselves and, ultimately, those who buy M&Ms and Snickers?
Colleges and universities were concerned their loan offices would get snagged by legislation meant to regulate big, bad banks and auto dealers, who also lend to consumers on occasion, were concerned they would be penalized inadvertently.
“We’ve got to raise awareness about why this doesn’t make sense and why it’s anti-consumer,” said David Hyatt, vice president for the National Automobile Dealers Association.
“Anti-consumer” — now, there’s an attention-getting phrase in the middle of a recovery.
For all that, the possibility of a new consumer protection agency seems suddenly to cast a shadow over a wider audience than payday lenders and subprime mortgage lenders. Imagine a bill in which payday lenders squirm out of oversight — the gougers of last resort, after all, have a lobbying presence on the Hill — and loans that keep the car industry going are suddenly criminalized. Where would we be then?
Sen. Christopher J. Dodd, D-Conn., who ushered the 1,400 page bill through the Senate Banking Committee, said it was a “red herring” for opposition to use such fear tactics. Assuming there are a few slow readers out there, however, the convenience of a lawsuit against Goldman Sachs bringing emotions to a boil is good for headlines, but not always a healthy way to make big decisions.
In international markets Tuesday, the Nikkei 225 index in Japan rose 0.42 percent while the Shanghai composite index in China fell 2.07 percent. The Hang Seng index in Hong Kong dropped 1.51 percent while the Sensex in India fell 0.31 percent.
In Australia, the S&P/ASX 200 slipped 0.03 percent.
In midday trading in Europe, the FTSE 100 index in Britain lost 1.24 percent, while the DAX 30 in Germany fell 0.78 percent. The CAC 40 in France lost 1.7 percent, while the pan-European DJ Stoxx 50 dropped 1.6 percent.
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