AP News
(2010-03-25 06:25:18)
WASHINGTON (Reuters) - Senate Banking Committee Chairman Christopher Dodd said on Friday that Congress "must not fail" to reform financial regulation and defended a bill approved this week by his committee.
With the Senate about to adjourn for a two-week recess, Dodd, a Democrat, appealed on the Senate floor to colleagues to go home and listen not only to financial institutions opposed to reform, but also to everyday Americans' views on the issue.
He said his bill ends the idea that some financial firms are 'too big to fail,' creates a strong consumer protection watchdog and addresses problems in the over-the-counter derivative markets, credit rating agencies and debt securitization, among other issues.
On timing for floor consideration of his bill, Dodd said:
"It is my hope that shortly after our return, on the second week of April, that we will come to the floor of the United States Senate to debate ... how we reform the financial services sector."
Democratic lawmakers, including Dodd, are working to break off enough support from Republicans to keep his bill moving in the Senate. It won approval at the committee level on Monday on a narrow vote on straight party lines.
Dodd now must secure the backing of a handful of Republicans so the bill can overcome procedural roadblocks.
Senator Richard Shelby, the top Republican on the committee, said the Dodd bill fails to end the "too big to fail" problem and "does not ensure that taxpayers are protected from the costs of bailing out failing financial institutions."
Shelby made his comments in a letter to Treasury Secretary Timothy Geithner that was obtained by Reuters.
Shelby also said the bill gives the Federal Reserve emergency lending authority that is "far too open to abuse" and creates a "backdoor way" for Treasury and the Federal Deposit Insurance Corp to prop up failing firms.
He added in the letter, however, that he believes "broad bipartisan support" could still be attained on legislation.
A national poll released on Thursday by the Pew Financial Reform Project said 59 percent of Americans want Congress and the president to reform the financial system now.
Almost two years since the collapse of Bear Stearns ushered in a severe financial crisis, tipping the economy into a deep recession, financial regulation has changed little.
President Barack Obama proposed a raft of changes in mid-2009. The House of Representatives approved most of them in December. The Senate has yet to act, with Republicans and lobbyists for banks and Wall Street fighting to block reforms.
(Editing by Chizu Nomiyama)
