For the Week of April 12th, 2010

Momentum Gathers for the Senate to Enact its Version of the Financial Regulatory Reform Bill
 

With Congress on recess for the past two weeks, both the Democrats and the Republicans spent
the time away from the nation’s capitol engaged in a delicate dance regarding regulatory reform,
with each side trying to achieve the best positioning. In fact, this dance has been so delicate that
even though the Senate Banking Committee voted the bill out of committee prior to the recess
and Leader Reid has indicated the legislation is a top priority for consideration when Congress
returns, to date there has been no public disclosure of when this debate will occur. Although we
have learned that the bill will be on the floor starting the week of April 26th, there are multiple
factors that could cause this date to slip.

What appears to be driving the complexity of this issue is that all sides involved (Senate
Democrats, Senate Republicans and the White House) all appear to have reached a conclusion
that passing regulatory reform is an important issue to the American public. However, beyond
that superficial agreement there appears to be a wide chasm between Democrats and Republicans
as to what the specifics of this reform should look like. Rightly or wrongly, the White House
seems to be bolstered by its victory on health care reform and appears to feel confident that it,
and Senate Democrats, should not compromise on too many aspects of the legislation.
Conversely, Senate Republicans appear to be calculating how to balance getting this legislation
through the regulatory process quickly enough so that it its passage isn’t a campaign issue in the
fall with ensuring that the substantive changes made by the bill do not cause too much pain to
their business interest base.

The other proverbial “x-factor” in this process is Senator Dodd, long known as dealmaker is
working without the burden of having to run for re-election in the fall, and is attempting to find a
balance between alienating moderate democrats or losing support from liberal democrats while
attempting to secure the enactment of what he views as his “legacy legislation.” However, some
GOP insiders believe that the serious ongoing discussions between Dodd and Shelby are an
indication that reform is possible, but both sides seem unable to determine whether the opposite
party is truly interested, or capable, of making the concessions necessary for this legislation to
pass with 70+ votes.

To read the complete report go to:  http://www.mintz.com/media/pnc/0/media.2140.pdf