Auto Dealers Fight Regulatory Reform

Sen. Sam Brownback and a group of auto dealers maintained that the Pentagon and the Obama administration are playing politics with financial-overhaul legislation as the Senate prepared to take another procedural vote on the bill.

More than 100 new-car dealers from across the country hit Capitol Hill Tuesday to urge senators to exclude their industry from proposed financial regulations, specifically oversight by a new consumer financial protection bureau.

The effort is just one example that the legislation carries high stakes for industries far beyond Wall Street.

Brownback, a Kansas Republican, is aiding their fight by pushing an amendment that would exclude auto dealers from the bureau's reach.

"Auto dealers did not cause this financial crisis," Brownback said at a press conference with several members of the National Automobile Dealers Association. "It seems ridiculous that we should even be talking about regulating them like banks."

Brownback said he would like to see his amendment incorporated into the text of the financial-overhaul bill. He believes he has a "good shot" of accomplishing that goal because Democrats are on the hunt for votes and his amendment could likely attract a few more supporters, Brownback said.

Sen. Richard Shelby, an Alabama Republican who is heading negotiations on the bill for his party, is supportive of the auto-dealer amendment, Brownback said. But so far Democratic leaders have been unwilling to accept it.

If he cannot win a change in the underlying bill, Brownback vowed to offer the amendment on the Senate floor. He said a number of other senators have indicated support for the measure, but declined to give an exact number.

"We're getting a lot of good support, and I think we will be successful," he said.

Brownback and the auto dealers are taking on another influential interest group: the military. A coalition of more than 30 military organizations is pressing lawmakers to resist the exclusion of the auto dealers, arguing that soldiers are targeted by predatory lenders.

The Department of Defense has spoken out on the issue as well, and the Treasury Department also opposes the exclusion as it tries to defend the consumer agency, a centerpiece of its proposal to overhaul financial regulations.

The standoff could set up a difficult vote for many senators. Auto dealers are influential in Congress, not least because they are a powerful local-business constituency with a presence in every district. The industry also argues it is still struggling to recover from the recession. In the House, the dealers won an exemption despite the opposition of top Democrats.

Yet the military is also a sympathetic voice, and the coalition has stepped up its lobbying since the House bill passed in December.

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