–Senate Majority Leader Says GOP Wants To Work Out Private Deal
–Sen. Reid: Time To End Negotiations, Begin Legislating On Reg Reform
–Senate Minority Leader McConnell: Dems Continue To Rush Reg Reform
–Sen. McConnell: Dodd Bill Would Have Negative Unintended Consequences

By John Shaw

WASHINGTON (MNI) – Senate Majority Leader Harry Reid said Tuesday
that the Senate will hold a second test vote at 4:30 p.m. Tuesday to
formally begin debate on a financial regulatory reform bill.

In comments on the Senate floor, Reid continued to hammer both
Senate Republican leaders and Wall Street, implying they have created an
unholy alliance to derail much needed regulatory reform.

Reid said that Republicans, who repeatedly derided backroom
dealmaking regarding health care reform, are now insisting that
Democratic and Republican leaders retreat into private rooms and craft a
financial reform package.

“They want all the details to be worked out beforehand and behind
closed doors,” Reid said.

“There comes a time when we have to start legislating and stop
negotiating,” Reid said.

Speaking after Reid, Senate Minority Leader Mitch McConnell said
that Democrats continue to “rush” financial regulatory legislation.

McConnell said that the Democratic bill is poorly drafted and could
have seriously negative unintended consequences over many sectors of the
American economy.

The Senate is expected to spend most of Tuesday debating financial
regulation before the 4:30 p.m.

In the first test vote Monday evening, Senate Republicans united to
defeat a Democratic motion to formally begin debate on a financial
regulatory reform bill.

The Senate voted 57 to 41 to begin the debate, but sixty votes were
required.

All Republicans who were present voted to block the debate from
going forward. (Two Republican senators did not vote.) All Democrats
voted to begin the debate except for two: Nebraska Senator Ben Nelson
and Senate Majority Leader Harry Reid.

But Reid changed his vote to No only after the outcome was apparent
for procedural reasons. This allowed him to bring the measure up again
for a future vote.

After the vote concluded Monday evening, Senate Banking Committee
Chairman Chris Dodd and Sen. Richard Shelby left the Senate chamber to
resume negotiations in Dodd’s Banking Committee office.

Shelby said that he is eager to reach an agreement with Dodd.

“What I’m working toward is a bipartisan deal right now,” Shelby
said.

Both Dodd and Shelby have said they’ve been narrowing their
differences on the legislation, but have not been able to reach an
agreement on a handful of issues.

The Senate Banking Committee approved Dodd’s regulatory reform bill
on March 22 on a party-line 13 to 10 vote. All Democrats supported the
bill and all Republicans opposed it.

Dodd’s legislation establishes a new independent Consumer
Protection Bureau at the Federal Reserve Board, creates a process to
liquidate failed financial firms, sets up a council of regulators to
oversee systemic risk in the economy, establishes a regulatory structure
for over-the-counter derivatives, requires hedge funds that manage over
$100 million to register with the SEC and creates a new office within
Treasury to monitor the insurance industry.

The Senate Agriculture Committee approved a narrower bill last week
that tightens regulation on derivatives. Parts of this bill are expected
to be merged with Dodd’s bill when the formal Senate debate begins.

The House passed a sweeping financial regulatory reform bill in
December.

President Obama has said that financial regulatory reform is one of
his central goals for the rest of this legislative session.

** Market News International Washington Bureau: (202) 371-2121 **

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