The Corner

Bipartisan Talks on Financial Regulation End

Sen. Richard Shelby (R., Ala.) has released a statement indicating that bipartisan talks on financial reform have ended at an impasse. It looks like there will be Republican-urged changes to the resolution authority, but that talks about changes to the sprawling consumer protection agency went nowhere.

“I thank Leader McConnell and my Republican colleagues for providing an opportunity for my negotiations with Chairman Dodd to run their course.  I believe we owed the American people our best effort to make whatever changes we could to this incredibly complex piece of legislation because it will have wide ranging implications for our economy.  Chairman Dodd has assured me that he will address a number of concerns I have expressed with respect to ending bailouts.  We have been unable, however, to make any meaningful progress on other important components of the legislation.  It is now my belief that further negotiations will not produce additional results.

“This bill still contains a sprawling new consumer protection bureau that will find and force its way into facets of our economy that had nothing to do with the housing crisis.  This massive new bureaucracy would have unchecked authority to regulate whatever it wants, whenever it wants, however it wants.  I am aware of no other arm of the federal government this powerful, yet so unaccountable.  In my negotiations with Chairman Dodd, I have consistently supported strengthening consumer protections.  I have also advocated for a sensible and meaningful role for safety and soundness regulators in this new agency’s operations.  Unfortunately, despite my demonstrated willingness to propose compromise solutions, this sensible step has proved to be a bridge too far.”

This seems to clear the way for a liberal/centrist Republican or two to reverse course, vote for cloture, and get some sleep tonight. Shelby said he’d “defer to [Republicans’] individual judgments on whether the Senate begins a floor debate on this bill.”    

UPDATE: And here’s Mitch McConnell, echoing Shelby on reaching an agreement on bailout stuff:

“I appreciate the efforts of Sen. Shelby to work toward a bipartisan solution on an issue that will have an impact on nearly every American. The time afforded by my Republican colleagues and Sen. Ben Nelson was instrumental in gaining assurances from the Chairman that changes will be made to end taxpayer bailouts and the dangerous notion that certain financial institutions are too big to fail.

“Unfortunately, Sen. Shelby believes that continued talks on a number of provisions affecting Main Street will not bring the negotiators any closer to an agreement. Now that those bipartisan negotiations have ended, it is my hope that the majority’s avowed interest in improving this legislation on the Senate floor is genuine and the partisan gamesmanship is over.  I remain deeply troubled by a number of provisions in this bill and will work aggressively in the days ahead to ensure that the majority does not use our mutual interest in regulating Wall Street to extend the federal government’s unwanted hand into Main Street.”

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