Byrd's death could delay financial reform vote
A tax on large institutions, added late to the bill, irks GOP supporters whose votes are needed to avoid a filibuster in the Senate.
House, Senate lawmakers reach a deal on financial reform
Reporting from Washington —
Just days after congressional negotiators agreed to a far-reaching financial reform package, the death of Sen. Robert Byrd on Monday threw into doubt the Senate's hope of passing the legislation this week.And there could be more problems in the Senate for the sweeping overhaul of financial regulation, President Obama's top legislative priority, after negotiators surprisingly added a new $19-billion tax on large financial institutions in reconciling House and Senate versions of the bill late last week.
Byrd's death also could make it more difficult for Congress to pass legislation Obama is seeking to address climate change by placing the first federal limits on global warming pollution, another controversial issue in which there are few votes to spare in the Senate.
On financial reform, the defection of just a single supporter in the Senate would be enough to block the bill's passage.
Sen. Scott Brown (R-Mass.), one of the few Republican supporters, said he was "extremely disappointed" that the tax on big banks, hedge funds and other firms was added and strongly suggested he would change his vote.
Brown's office did not say Monday whether he would vote against the legislation. But in a statement Friday, he said he feared that the tax, designed to cover the cost of the legislation's new regulations and oversight, would be "passed on to consumers in the form of higher bank, ATM and credit card fees and put a strain on lending at the worst possible time for our economy."
"I've said repeatedly that I cannot support any bill that raises taxes," Brown said.
Another Republican supporter, Sen. Susan Collins of Maine, said Monday that she also was concerned about the $19-billion tax and was "taking a look" at it.
Because of congressional procedures, it would be difficult to remove the bank tax from the bill without opening the legislation to a host of other proposed changes from opponents, further delaying — and possibly derailing — the process. One financial industry executive said such a move would open a Pandora's box.
The House was prepared to approve the final version as early as Tuesday, but stunned senators were still grappling with the death of Byrd, the legendary 92-year-old West Virginia Democrat, as administration officials scrambled to push the legislation over the finish line this week.
"Byrd was obviously a very, very reliable Democratic vote," said Jennifer Duffy, who monitors the Senate for the Cook Political Report in Washington, a nonpartisan newsletter.
" Democrats are going to have to go back and count noses on things like financial reform and make sure they have the votes," she said. "While they never had a margin for error, it's slimmer now."
West Virginia Gov. Joe Manchin III, a Democrat, will appoint a replacement and is almost certain to name another Democrat. But he is unlikely to make the appointment for several days.
That would make it impossible for Senate Democratic leaders to pass the financial reform legislation on Thursday as they had hoped unless they can find another vote to reach the 60 needed to overcome an expected Republican filibuster.
On a key procedural vote last month to block a filibuster, Democrats got exactly 60 votes, including Byrd's and Brown's.
Two Democrats, Maria Cantwell of Washington and Russ Feingold of Wisconsin, broke with their party and voted against the legislation. They argued it was not tough enough on Wall Street, while Republican opponents have complained the bill goes too far in expanding government oversight of the financial system.
Obama has pushed lawmakers to pass the legislation before they leave for their weeklong Fourth of July recess.
The Senate passed a version of the bill last month that differed from the House legislation on some contentious points, such as requiring large banks to spin off their lucrative derivatives businesses and including auto dealers under the oversight of a new agency to protect consumers in the financial marketplace.
A joint House and Senate conference committee worked for two weeks to reconcile the differences, finishing their work just after dawn Friday after a marathon 20-hour session. The push was designed to allow Obama to take the finished product to the G20 economic summit in Canada last weekend and then allow the House and the Senate to pass the 2,319-page bill this week.
Exhausted but jubilant supporters on Friday predicted the revised legislation would be approved this week. And Obama declared that "we are poised to pass the toughest financial reform since the ones we created in the aftermath of the Great Depression."
Cantwell and Feingold will face new pressure to vote for the legislation. But Feingold reiterated his opposition Monday.
"While there are some positive provisions in the final measure, the lack of strong reforms is clear confirmation that Wall Street lobbyists and their allies in Washington continue to wield significant influence on the process," he said.
A spokesman for Cantwell said she was reviewing the final version of the bill and had not decided on her position.
Treasury Secretary Timothy F. Geithner, White House economic advisor Larry Summers and other administration officials were working Monday to help secure the final votes, a White House official said.
Sen. Charles E. Grassley (R- Iowa) is another potential target for the White House. Grassley supported the Republican attempt to block the Senate bill from a vote last month. But after that effort failed he voted for the bill's passage. His spokeswoman did not respond to a request for comment.
On climate change, Senate proposals would, among other things, limit greenhouse gas emissions such as those produced by coal-fired power plants. But it's unclear whether there are enough votes to block a Republican-led filibuster.
Though it is uncertain how Byrd would have voted on the latest climate change proposals, he broke with his fellow West Virginian, Democratic Sen. John D. Rockefeller IV, and voted to defeat a measure that would have blocked the Environmental Protection Agency from regulating global-warming pollution from coal-fired power plants.
Whomever the governor of coal-producing West Virginia appoints as Byrd's replacement could take a different view from his predecessor.
"Joe Manchin is very pro coal," said Roman Stauffer, a West Virginia Republican who writes a blog called West Virginia Red. "He's spoken out against the EPA action in West Virginia and how it's impacting coal mining jobs in the state."
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