Financial reform is on the way, courtesy of Freshman Republican Senator Scott Brown (MA). The procedural vote to limit debate passed today with the precise number needed -- 60. Although Brown voted 'no' yesterday, he changed his vote today, despite the fact that no additional amendments had been considered since that time. Arlen Specter (D-PA) also voted in favor of the motion today. Yesterday, he didn't cast a vote. So where do things go from here?
First, it's worth noting that both of the Democrats that voted against the bill yesterday -- Senators Maria Cantwell (D-WA) and Russ Feingold (D-WI) -- did the same today. That's likely because no more amendments were heard, and that was exactly their complaint for voting 'no' the first time. But with the addition of Brown's and Specter's votes, it didn't matter.
Brown's Change of Heart
What changed Brown's mind between yesterday and today. Reid had expressed frustration that Brown hadn't voted for cloture yesterday, as Brown had apparently said he would vote for the motion. But afterward Brown released a statement saying:
As it currently stands, however, this bill would prohibit businesses in Massachusetts from continuing to do business as has been done for decades and would lead to serious job loss in our state. Specifically, it does not address my concerns about the Volcker rule for both insurance companies and our safe custody banks - institutions that did not contribute to the financial crisis, but would be crippled by the current legislation and in turn would result in job losses.
My constituents sent me to Washington to look out for their priorities first and foremost, and I cannot in good conscience vote to end debate on a flawed bill. I will continue to work in a bipartisan fashion in the days ahead to improve this bill for my state and my country.
Of course, the Volcker rule -- taken up by the Merkley-Levin amendment -- didn't pass since the last vote. But Reid's office indicates that it will be second in priority for consideration before the final vote. So Reid's promise that he will try to get the amendment heard is all it took. Brown's office released another statement today saying:
I supported moving the financial bill forward today because I received assurances from Senator Reid and his leadership team that the issues related to Massachusetts in the financial reform bill will be fixed before it is signed into law. We are still working to ensure these commitments are fulfilled prior to a final vote.
It then alluded to the Volcker rule.*
There's little doubt that many Republicans will be outraged by the new Senator's decision to spurn his party's strategy to block the bill. Surely, they must have hoped that he wouldn't go the way of Republican Senators from Maine, Collins and Snowe. They also voted in favor. But he is, alas, from Massachusetts.
It sounds like Reid is going to try to push for a final vote as quickly as possible. According to his office, there are only two amendments pending, one by Sen. Brownback (R-KS) that would exclude auto dealers from the consumer financial protection bureau's jurisdiction, and the one mentioned earlier by Senators Merkely (D-OR) and Levin (D-MI) that would ban banks from proprietary trading.
If Republicans cooperate, then a final vote could be held as early as tonight. But if they force Democrats to wait the full 30 hours Senate procedure allows for, then final vote could be delayed until tomorrow.
The final vote should pass fairly easily. If cloture got 60 votes, it's hard to imagine that the final bill -- which only needs 50 -- could fail. Once the Senate passes the bill, it must then be reconciled with the House version passed in December. That conference process can take anywhere from a week to months. But since Democrats are motivated to get financial reform finalized quickly, you can expect them to work hard to find a bill agreeable to both houses. But given some of the significant differences between the two pieces of legislation, that won't be easy.
Also, see Chris Good's take from our Politics Channel here.
* Update: Brown's office provided some clarification through two letters from House Financial Services Committee Chairman Barney Frank (D-MA), regarding an intention for conference. Frank assured the Senate that he would fight for exemptions to the Volcker Rule for insurance companies and bank asset management. Frank authored the House Bill, which does not explicitly ban prop trading, so implicitly contains these exemptions. This is a priority for Brown, since insurance and asset management businesses are important to Massachusetts.
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