WASHINGTON-The escalating fighting between Republicans and Democrats that threatened passage of the healthcare reform bill now is jeopardizing financial services legislation.
The Democrat-controlled Senate Banking Committee last Monday approved a bill on a straight party-line vote only hours after the 10 Republicans on the panel pulled some 300 amendments they were going to propose to obstruct the bill. Alabama's Richard Shelby, the Republican leader on the committee, said he and the other Republicans on the panel decided the strategy on amendments would have been "useless" and they will hold their powder to fight the bill when the full Senate votes on it in the coming weeks.
"I don't see today's mark-up as the end of the road, but another step in the process," said Shelby during the recent committee vote on the bill.
The script followed the theme of the debate on healthcare reform, for which no Republican in the Senate or House has voted. In the narrow vote on the healthcare bill, every one of the House's 178 Republicans voted against the bill.
As the financial services bill moves to the Senate floor lobbyists are expecting the debate to develop along similar lines. "It seems like it's going to be a party-line vote," said John Magill, chief lobbyist for CUNA, who said he expects the Republicans to use a filibuster, which would require the Democrats to get 60 votes to pass the bill. Since there are 41 Republicans in the Senate, the Democrats will need at least one vote from a Republican to pass the bill. "I really think it's going to take 60 votes," said Magill.
The bill is the culmination of plans to rein in the excesses many people think caused the financial crash. Among other things, it would: create a new consumer financial protection agency; set new disclosures for financial derivatives; regulate Wall Street agencies for the first time; create a government agency to liquidate "too big to fail" financial institutions; and, allow shareholders to have a say on executive compensation.
The focus for credit unions is the consumer financial protection agency, which would be created as an independent agency or bureau as part of the Federal Reserve. It would relate to credit unions in a similar manner as the Fed does now-by writing consumer rules and having the credit union regulator interpret them for credit unions. Under the Senate's proposal, all credit unions with less than $10 billion in assets would continue to be examined for consumer compliance by their current regulator. The three largest credit unions in the country, Navy FCU, North Carolina SECU and Pentagon FCU, and all other institutions over $10 billion, would be examined by the new consumer agency/ bureau.
NAFCU is trying to get an amendment introduced that also would exempt those three giant credit unions. NAFCU is also working on an amendment on the issue of preemption, so that rules allowing state consumer laws to trump federal laws could be waived if NCUA found it proper or necessary. Brad Thaler, senior lobbyist for NAFCU, said the trade group hopes to convince a Senate sponsor to introduce its amendments when the bill goes for a vote by the full Senate. "We still feel the best opportunity will be when it goes to the floor, when the deal's likely to be cut to get the bill passed," said Thaler.
