AFTER a bruising Capitol Hill battle
over health-care reform, partisan camps are at it again, this time about a financial-reform bill with Republicans firing the first salvo.
But a fight during a competitive mid-term election year could backfire on this issue because nobody wants a repeat of the 2008-09 turmoil that led to the worst recession since the Great Depression. The Senate bill, drafted during the last six months, contains many ideas from key Republicans on the Senate Banking Committee.
The reform bill would toughen oversight of banks and capital markets, and improve consumer protections. A House version of the measure passed in December, but a showdown looms in the Senate as Democrats aim to pass a final bill by the end of April.
Republicans have seized on a provision that would allow regulators to step in to dismantle large, troubled firms. They say it would set the stage for endless bailouts of Wall Street, a claim the architect of the legislation and committee chairman says couldn't be further from the truth.
"The bill as drafted ends bailouts," said Sen. Chris Dodd. "It eliminates the federal government's ability to bail out financial companies and requires that the financial firms write their own shutdown plans and even pay for the liquidations process if it's needed."
Leading Democrats and the White House lashed out at what they called the GOP's misinformation campaign based on political talking points. Sound familiar?
But just saying no to whatever Democrats propose on financial regulations may put Republicans at risk of appearing to side with banks. That's not good when anger against Wall Street is high and people are impatient for solutions that will strengthen the ability of the nation's economy to withstand future financial crises.