Financial Reform

Progressives Drive Hard Bargain On Wall Street Bill

Brian Beutler | May 11, 2010, 1:27PM

Sen. Ted Kaufman (D-DE)

At just about every stage of the Senate financial reform process, the changes to the bill have trended towards the left--and that may well be borne out again if Democrats successfully add provision to the bill that will, among other things, ban big banks from using their own capital to engage in market speculation.

The provision is called the Volcker Rule--named after former Fed Chair Paul Volcker who now heads the President Obama's Economic Recovery Advisory Board. Currently, two Democratic senators--Carl Levin (D-MI) and Jeff Merkley (D-OR)--are pushing to add the rule to the Wall Street reform legislation and have built up quite a head of steam. That development was not a sure thing even a few days ago but with the political climate so anti-Wall Street even progressives' failures can turn into successes, which is what sort of happened with the Volcker Rule.

Last week, Sens. Sherrod Brown (D-OH) and Ted Kauffman (D-DE) pushed hard to get their very progressive 'too big to fail' amendment passed. Even though it failed it helped pave the way to enshrining the Volcker rule in the bill.

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Financial Reform

Senate Adopts Sanders' 'Audit The Fed' Amendment

Eric Lach | May 11, 2010, 12:08PM

Sen. Bernie Sanders (I-VT)

The Senate today voted overwhelmingly to adopt an amendment, authored by Sen. Bernie Sanders (I-VT), forcing a comprehensive review of the Federal Reserve's emergency lending activities. The amendment passed by a 96-0 vote.

Though the measure was always popular, it faced extraordinary opposition from the White House, Wall Street and the Fed itself. Late last week, in a move that defused the opposition, and may have saved Wall Street reform legislation, Sanders agreed to limit the scope of the audit to emergency lending only, exempting other Fed activities.

That preserved the broad intent of the plan, which was always aimed at bringing the Fed's shadowy activities during the financial crisis into the daylight. Under the terms of the proposal, the Fed will also be required to make public which companies received upwards of $2 trillion in aide from the Fed, and under what terms.

In December, the House of Representatives adopted a similar provision--authored by Reps. Alan Grayson (D-FL) and Ron Paul (R-TX)--that would have required a comprehensive Fed audit. But though Grayson still supports a full audit, he applauded the steps that the Senate is taking in a statement last week. "There is deep bipartisan support for a full audit of the Federal Reserve, in both the House and the Senate," Grayson said. "The Sanders Amendment takes a significant step in that direction. I will work hard to help Dr. Paul and Senator Sanders to get a full Fed audit in the final bank reform bill. It is time for America to know what happened to our money."

Reporting by Brian Beutler.

Financial Reform

Vote On Fed Audit Delayed To Accommodate Bennett

Brian Beutler | May 6, 2010, 8:23PM

Sen. Bob Bennett (R-UT)

A last minute snag tonight temporarily delayed a vote on Bernie Sanders' amendment--still expected to pass overwhelmingly--to force an audit of the Federal Reserve.

Republican Sen. Bob Bennett is in his home state of Utah today, in the last days of a tough primary campaign. Because the race is so close, he doesn't want to be held accountable for missing a vote on an important amendment, popular on the grassroots right, so Republicans sought a delay. To move things along, Democrats acceded, but will instead hold votes on several other amendments tonight--including one, authored by Sen. Sherrod Brown (D-OH), limiting the size of large financial institutions.

Sanders' amendment will likely get a hearing Tuesday.

Financial Reform

Wall Street Reform Takes A Populist Turn

Brian Beutler | May 6, 2010, 7:09PM

Sen. Bernie Sanders (I-VT)

Anti-Wall Street sentiment is so strong and Republicans have such a weak hand that Democrats in the Senate are suddenly finding themselves strengthening the financial reform bill with new amendments and beating back GOP attempts to weaken it.

The latest evidence of this populist surge is that the Senate is now expected to adopt an amendment, authored by Sen. Bernie Sanders (I-VT), that will require an audit of all of the Fed's emergency lending activities, starting in late 2007.*

Sanders' success in winning support for his amendment is emblematic of the greater debate over financial reform, which has, thanks to the Democrats' aggressive political posture, and the unpopularity of Wall Street, been much more favorable to progressives, even over the objection of powerful interests.

The Sanders measure is similar to a Fed audit proposal that was included in the House's financial reform legislation, which passed last December, and should simplify the process of ironing out the differences between the two bills in a conference committee.

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Audit the Fed

Sanders' Fed Audit Amendment Likely To Prevail

Brian Beutler | May 6, 2010, 4:24PM

Sen. Bernie Sanders (I-VT)

Could Sen. Bernie Sanders (I-VT) shake off powerful opponents of his proposal to audit the Federal Reserve? It looks like he's about to do just that. By making a few changes to his financial reform amendment, Sanders has won support from Senate Banking Committee Chairman Chris Dodd, and Majority Leader Harry Reid, and seems more poised than ever to prevail. The Senate should vote on his amendment later today.

In order to allay some of the White House's and the Fed's concerns, Sanders has agreed to limit the scope of what the Government Accountability Office would be allowed to audit--but his plan will still require thorough review of all the Fed's emergency lending, beginning December 1, 2007.

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Audit the Fed

Dis! Sanders Learns Of White House Plans To Kill Fed Audit In New York Times

Brian Beutler | May 6, 2010, 12:49PM

Sen. Bernie Sanders (I-VT)

Sen. Bernie Sanders (I-VT) keeps hearing from Rahm Emanuel about his proposal to force a comprehensive audit of the Federal Reserve. But the White House isn't calling to tell him about new plans to kill his amendment.

The White House is hoping to cobble together a separate proposal, to be offered as an alternative to Sanders' backers. The so called "side-by-side" would give them cover to vote down the Fed audit amendment, by offering them them a weaker plan to support.

But Sanders had to read about this plan in the newspaper.

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Financial Reform

Alaska Senators Co-Sponsor Controversial 'Audit The Fed' Measure

Laura Colarusso | May 6, 2010, 11:24AM

Sen. Lisa Murkowski (R-AK) and Sen. Mark Begich (D-AK)

The controversial "audit the Fed" amendment that would force the Federal Reserve to open up its books has two more c-sponsors.

Sens. Lisa Murkowski (R-AK) and Mark Begich (D-AK) have signed on to support the amendment to the financial reform bill now pending in the Senate. Sen. Jeanne Shaheen (D-NH) became a co-sponsor on Tuesday.

Introduced and championed by Sen. Bernie Sanders (I-VT), the "audit the Fed" measure has supporters on both sides of the aisle. However, the White House, the Fed and the financial industry staunchly oppose the measure. Sanders is trying to round up the 60 votes it need to overcome a likely filibuster. President Obama will likely be under intense pressure to veto the entire financial reform bill if "audit the fed" survives.

Reporting by Brian Beutler

Chris Dodd

Senate Debate On Wall Street Reform Begins In Earnest

Brian Beutler | May 5, 2010, 6:37PM

Sen. Chris Dodd (D-CT) and Sen. Richard Shelby (R-AL)

With the passage of an amendment this afternoon to change the way the Democrats' proposed Wall Street reforms would wind down failed financial institutions, the debate is truly, finally, on. Now all that's left is for Democrats to blast through 100 or so separate amendments in the next few days to meet their goal of finishing up work on the bill by early next week.

That wouldn't be so hard under ideal circumstances: Democratic and Republican negotiators could sift through the pile, eliminate redundancies, toss out non-germane proposals, combine others into a managers amendment, and hold up or down votes on the remaining batch.

But in this highly partisan atmosphere, a single objection at a key moment could set things back for days, and that would leave Democratic leadership forced to choose between pushing back their deadline, or retracting their promise to allow an open amendment process.

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Audit the Fed

Sanders Concerned White House May Kill Fed Audit Amendment

Brian Beutler | May 4, 2010, 3:40PM

Sen. Bernie Sanders (I-VT)

Sen. Bernie Sanders (I-VT) has rounded up an impressive, bipartisan array of cosponsors to an amendment he authored requiring an audit of the Federal Reserve. Just today, he added Sens. Jeanne Shaheen (D-NH) and Maria Cantwell (D-WA) to a list that includes 12 Republicans, seven Democrats, in addition to Sanders himself.

In the past, a different version of legislation opening up the fed to audit received 59 votes--one shy of the 60 required to break a filibuster. But eight of the Republicans who voted no are now cosponsors of Sanders' amendment. That should mean it's a shoo-in, right?

Not necessarily.

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Financial Reform

Sen. Shaheen Co-Sponsors Controversial Audit The Fed Amendment

Laura Colarusso | May 4, 2010, 1:24PM

Sen. Jeanne Shaheen (D-NH)

Sen. Jeanne Shaheen (D-NH) will co-sponsor an amendment that would require government auditors to open up the books at the Federal Reserve.

The "audit the Fed" measure, first introduced by Sen. Bernie Sanders (I-VT), is actually popular on both sides of the aisle, but is staunchly opposed by the White House, the Fed and the financial industry. Sanders is trying to round up the 60 votes it need to overcome a likely filibuster.

The Obama administration will most likely be under intense pressure to veto the entire financial reform bill if "audit the fed" survives.

Reporting by Brian Beutler

Audit the Fed

Deal Killer? White House Takes Aim At Fed Audit Provision

Brian Beutler | May 4, 2010, 10:37AM

President Barack Obama, Federal Reserve Board Chairman Ben Bernanke, and Sen. Bernie Sanders (I-VT)

Possibly today, but if not today then soon, the Senate will decide whether or not to follow the House's lead and adopt a provision requiring government auditors to open up the books at the Federal Reserve. The measure enjoys a great deal of popularity on both the left and the right, but is so fiercely opposed by powerful interests that it could nonetheless become a stumbling block in the way of financial regulatory legislation.

Right now Sen. Bernie Sanders (I-VT) is trying to round up 60 or more votes to overcome a likely filibuster and include an "audit the Fed" provision in the Senate's bill. There are just a few small obstacles: the White House, major financial institutions, and the Fed itself. Their resistance is fierce--but the measure is so popular that killing it will be difficult for them and that, in their eyes, threatens to put a grenade at the center of efforts to to tighten the rules on Wall Street.

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