WASHINGTON — Unable to muster bipartisan agreement on key banking provisions, the chairman of the Senate Banking Committee said Thursday he would offer his own version of a sweeping overhaul of U.S. financial regulations without Republican support.
A month of talks between Sen. Christoper Dodd, a Democrat, and Republican Sen. Bob Corker found some common ground but failed to yield agreement on consumer protections and other sticking points.
“Together we have made significant progress and resolved many of the items, but a few outstanding issues remain,” Dodd said in a statement. Dodd said he still aimed to get a consensus bill but said time was running out.
Dodd’s go-it-alone choice is in keeping with an emerging culture of high partisanship in Congress, where Democrats and Republicans have been at odds for over a year on health care changes, little progress has been made on climate change and energy legislation, and members of both parties watch warily as an angry voting public continues to show heavy disdain for incumbents ahead of November congressional elections.
Corker said Thursday he and Dodd had made significant progress and had agreed in principle on consumer protections, one of the most contentious issues. He described himself as disappointed in Dodd’s decision but said he expected Dodd’s proposal would be more moderate than a bill Dodd drafted late last year.
Still, Corker blamed Dodd’s rush to propose a new bill on the current dispute over health care and pressure on Dodd to offer a bill before the Senate puts the health care bill through a bitterly partisan fast-track process.
“He made me aware that with reconciliation coming, he felt a need to go ahead and, regardless of where we were in negotiations to put forth a bill on Monday,” Corker said. Reconciliation is the process that makes it easier for majorities to succeed in the arcane rules of the U.S. Senate. “I understand the pressure that he is under.”
In his statement, Dodd said: “We have reached a point where bringing the bill to the full committee is the best course of action to achieve that end,” he said. Dodd, a Connecticut Democrat, plans to have the Banking Committee take up the bill the week of March 22.
He said he and Corker would continue to hold talks. Corker planned to comment on the legislation later Thursday morning.
The development raises new questions about one of President Barack Obama’s top priorities. Congress and the administration have been trying to assemble an overhaul of regulations in hopes of preventing a recurrence of the financial crisis that hit the nation in the fall of 2008. The House passed its version of a bill in December on a party-line vote.
Republican Sen. Judd Gregg, a member of the Banking Committee, said he remained optimistic that the committee could still write a bipartisan bill. But Gregg said the use of reconciliation has damaged relations in the Senate.
“It clearly poisons the well; it’s a clear attempt to ram something through the minority,” he said
Dodd said he and Corker would continue to hold talks. Corker planned to comment on the legislation later Thursday morning.
The development raises new questions about one of President Barack Obama’s top priorities. Congress and the administration have been trying to assemble an overhaul of regulations in hopes of preventing a recurrence of the financial crisis that hit the U.s. in late 2008. The House passed its version of a bill in December on a party-line vote.
Dodd in November proposed a draft bill that drew swift Republican objections. Dodd, aware that he now needs Republicans on the bill to overcome procedural delays, then tried to negotiate with the committee’s ranking Republican, Sen. Richard Shelby. When those talks stalled, Dodd turned to Corker in hopes of bridging some differences.
The main obstacle remains a proposed Consumer Financial Protection Agency that the president has made one of the central provisions in the bill. The House version provides for such a stand alone agency, which would regulate institutions that offer credit, mortgages or other consumer financial products.
Republicans, bankers and many in the business sector oppose a separate agency, saying it would add another layer of regulation and bypass existing bank regulators.
Dodd had proposed placing such an agency inside the Treasury Department and giving federal bank supervisors some say in the consumer entity’s regulations. Corker countered with a proposal to place the agency inside the Federal Reserve. But the two were unable to find common ground on how much independence to give it.