Republicans Drop Filibuster, Allow Democrats to Debate Wall Street Reform Bill

ABC’s Z. Byron Wolf reports: It only took 3 cloture votes, a Goldman Sachs public flogging and the threat of an all-night session, but Republicans dropped their filibuster and allowed Democrats to bring their Wall Street reform bill to the Senate floor.

The Republican leaders pointed to concessions Democrats have promised to make to their bill as important concessions that led to dropping the filibuster. Chief among those was the dropping of a $50 billion fund that big banks would have created to help dissolve large, failing funds. Democrats and some Republicans saw that fund as an implicit guarantee of future federal bailouts like the controversial $700 billion TARP bailout of 2008.

“Nothing should be too big to fail,” said Sen. Richard Shelby, R-Alabama, Republicans chief negotiator, on the Senate floor Wednesday night.

But Republicans failed to get Democrats to cede ground on other issues and the broad, bipartisan agreement that many Republicans were holding out for was not achieved. Many Republicans still have reservations about Democrats’ inclusion of a large and influential Consumer Protection Agency that would be overseen by the Federal Reserve and have jurisdiction to regulate financial products like home loans.

Shelby said the closed-door bipartisan meetings between himself and Sen. Chris Dodd ended in impasse.

“Now that my negotiations with Chairman Dodd have reached an impasse, I thank my Republican colleagues for their support and defer to their individual judgments on whether the Senate begins a floor debate on this bill,” said Shelby in a written statement.

At a late afternoon caucus meeting, Republicans decided the best course was to agree en-masse to allow the bill to be considered on the floor rather than show the divisions in their party on whether to consider the measure.

Minority Leader Mitch McConnell said the negotiations between Shelby and Dodd did yield new language regarding too big to fail institutions and how to unwind them. That agreement will be added to the existing bill as soon as Thursday. McConnell said he will work to make Democrats keep the amendment and debate process open on the Senate floor as it progresses over the coming weeks.

“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,” said McConnell in a statement.

Republicans had made the point several times earlier in the week that Democrats, because of the health reform debate, could not be trusted to debate the bill.

Don’t look for either Republican leader to sign on to the legislation any time soon.

“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,” said McConnell

Republicans will have opportunities to block the bill going forward if they do not like its final version after the amendment process.

But their agreement to consider the bill caps several weeks of political haranguing as Democrats hit Republicans again and again for blocking the reform bill. Most Americans and even Republicans support new rules for Wall Street after the financial crisis of the past several years and the Wall Street bailout in 2008.

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