As reported by TheHill.com, Sen. Scott Brown (R-Mass.) announced today that he will vote for Wall Street reform when it comes up for a final vote in the Senate, bringing the Democrats that much closer to securing the bill’s final passage.
“I appreciate the efforts to improve the bill, especially the removal of the $19 billion bank tax. As a result, it is a better bill than it was when this whole process started,” Brown said in a statement on Monday. “While it isn’t perfect, I expect to support the bill when it comes up for a vote.”
By way of quick background, the House voted in favor of the bill on Wednesday June 30 by a 237-192 vote, but not before some frantic last minute changes were made to the conference report to remove a provision that would have imposed $19 billion in new bank fees and taxes on banks with more than $50 billion in assets and on hedge funds with more than $10 billion in assets. In a highly usual move, the assessment was removed by House-Senate conferees who reconvened in an emergency meeting after it became clear that the tax provision would likely cost the Democrats crucial Republican votes.
Specifically, the assessment, which was added to the initial conference report to cover the costs of the bill, threw the passage of the bill into doubt because Senator Brown said he would vote against any measure that raised taxes. Senator Brown was one of four Republicans to vote in favor of the Senate bill in May, and his support is crucial to its overall passage.
With the bill’s passage in doubt, Senator Chris Dodd and his fellow Democratic conferees scrambled on Tuesday June 29 to find a solution that would appease Senator Brown and his Republican colleagues. In a last minute deal, House-Senate conferees agreed to remove the $19 billion fee and in its place to insert a provision that would shut down the $700 billion TARP bank bailout program, which would free up resources to pay for financial reform. In addition, the bill will also raise FDIC premiums from a ratio of 1.15% to 1.35%. The biggest banks would be subject to the higher FDIC fees, but not hedge funds, since they are not part of the FDIC system. The Republicans agreed to the deal late Tuesday evening July 29, and the revised conference report was sent to the House on Wednesday June 30 where it was approved by a 237-192 vote.
After the House vote, the focus immediately shifted back to the Senate, where the Senate Democrats decided to delay a final vote until after the July 4 recess to ensure they will have the 60 votes necessary to overcome procedural hurdles. With the passing of Democratic Senator Robert Byrd, Democrats control 58 votes in the Senate, two shy of the 60 they would need to break a Republican filibuster.
Moreover, two Democrats — Maria Cantwell of Washington and Russ Feingold of Wisconsin — have consistently voted against the plan, saying it should limit banking practices more aggressively. Feingold has already stated that he will also not vote in favor of shutting down the debate. If Cantwell takes the same position, Democrats would need four Republicans, although it should be noted that West Virginia Gov. Joe Manchin (D) is expected to appoint a temporary replacement soon, and that new senator would also be expected to vote for Wall Street reform, in which case the Democrats would need three Republicans.
In addition to Scott Brown’s endorsement today in favor of the bill, Republican Senator Susan Collins said publicly that she would vote for the conference report since the $19 billion fee provision was removed.
“Based on my initial review of the final version of the conference report, I am inclined to support it,” said Sen. Collins on Wednesday June 30.
According to TheHill.com, another Republican, Sen. Olympia Snowe (Maine), is also seen as a likely ‘yes’ vote.
Thus, Senator Dodd and his fellow Democrats have every reason to hope that the bill will be approved by the Senate shortly after it reconvenes following the July 4th recess.