Brian Beutler May 18, 2010, 9:08 PM

There’s now officially a plan to scale back Blanche Lincoln’s far-reaching proposal to regulate derivatives, and it comes from a leading Democrat.

At issue remains Lincon’s plan to force financial companies to spin off their derivatives trading desks into distinct entities. Today, minutes before the noon filing deadline, Senate Banking Committee Chairman Chris Dodd introduced legislation to delay the spin-off provision for two years, pending review by federal regulators, and likely scotching it altogether.

Already, progressive and conservative senators are rebelling against the Dodd plan—though it’s unclear if or when the plan will get a vote. And, as reported here last week, the timing spares Lincoln, who’s facing a primary election tonight, the political embarrassment that would have accompanied gutting the most controversial and populist element of her plan. In fact, the plan itself could give Lincoln cover to argue that her proposal has been preserved. Though in a statement issued today, Lincoln reiterated her support for her amendment and vowed to fight to preserve it.

“I remain fully committed to my provision and will fight efforts to weaken it,” Lincoln said. “I’m proud of the support my provision has received both inside and outside the Senate and will defend it should there be a debate on the Senate floor.”

More to come.

Blanche Lincoln, Chris Dodd, Democrats, Derivatives , Financial Reform, Wall Street