Wall St. Bill Faces 400 Changes

Flickr/<a href="http://www.flickr.com/photos/davidberkowitz/2851354225/">David Berkowitz</a>.

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More than 400 amendments will likely be proposed beginning this week to change the Senate’s financial reform bill, many of them in an effort to whittle down the relatively strong Wall Street overhaul offered by Sen. Chris Dodd (D-Conn.), chair of the banking committee. 110 of those amendments, according to a Senate document describing the amendments obtained by Huffington Post, come from Sen. Richard Shelby (R-Ala.), the top GOPer on the banking committee, who failed to reach a bipartisan agreement with Dodd last month. Almost a hundred more come from Sen. Bob Corker (R-Tenn.), whose talks with Dodd broke down earlier month despite reaching the “five-yard line,” according to Corker.

The amendments range in scope and ambition. Some would bulk up Dodd’s bill, like Sen. Jack Reed’s amendment to make a new consumer protection agency independent and standalone (Dodd’s version makes it independent, but houses it within the Federal Reserve). Others would weaken or radically alter what Dodd offered. Shelby, for instance, submitted an amendment calling for the merger of the Securities and Exchange Commission with the Commodity Futures Trading Commission. Another of Shelby’s would strip a new Council of Regulators, designed to spot and tackle too-big-to-fail institutions, of the power to implement tougher rules for non-banks and bank holding companies, like Goldman Sachs and Morgan Stanley. One of Corker’s would ban securitizing subprime mortgages altogether.

Further amendments push for “accountability and transparency reforms at the Federal Reserve” from Sen. Jim Bunning (R-Ky.), a demand that President Obama report to Congress on potential reforms of housing corporations Fannie Mae and Freddie Mac from Sen. David Vitter (R-La.), and giving a new consumer protection agency primary authority over non-bank companies, like payday lenders, from Sen. Charles Schumer (D-NY). One amendment offered by Dodd directing the Government Accountability Office to review “Repo 105” accounting gimmicks—the kind used by Lehman Brothers to cook its books—is a clear reaction to the recent report on Lehman’s demise by its bankruptcy examiner.

As the Senate banking committee heads into mark-up this week, all of these amendments will come into play. While some of them would bolster the bill, many amount to death by a thousand cuts for Dodd’s Wall Street crackdown. Check back here throughout the week for the latest on the maneuvering and potential gutting of the Senate’s financial reform efforts.

 

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In "News Is Just Like Waste Management," we unpack what the coronavirus crisis has meant for journalism, including Mother Jones’, and how we can rise to the challenge. If you're able to, this is a critical moment to support our nonprofit journalism with a donation: We've scoured our budget and made the cuts we can without impairing our mission, and we hope to raise $400,000 from our community of online readers to help keep our big reporting projects going because this extraordinary pandemic-plus-election year is no time to pull back.

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