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Rating Agency, Anti-Trust Exemption Votes Today; Lincoln Protected by Senate Club

The latest report is that the Wall Street reform bill will extend into next week, with a final vote on Tuesday. Today, there are votes expected on a number of amendments, including two of note: Sen. Franken’s amendment, which has bipartisan support, to reform the credit rating agencies; and Sen. Leahy’s amendment that would, wait for this, repeal the health insurance industry’s anti-trust exemption. What? No, really, Pat Leahy included an amendment on the anti-trust exemption, and it’ll get a vote today, and if it requires only 51 votes like every other amendment has so far, it’ll pass. Hopefully, the Franken amendment will too.

I know that the leadership has been pushing for a conclusion to the bill, but this doesn’t sound right at all:

Behind the scenes, Democratic leaders are beginning to raise pressure on senators to close out floor action on the financial bill. Under one scenario being discussed, a final vote could come as soon as Tuesday after a possible vote on Monday to shut off debate on amendments.

Complicating that goal is the prospect that two embattled Democrats — Sens. Arlen Specter of Pennsylvania and Blanche Lincoln of Arkansas — are expected to be out Monday campaigning ahead of tough Tuesday primaries. Their absence will place even greater importance attracting GOP support for the financial regulation bill since 60 votes are needed to shut off debate.

Maybe they can pick up Lugar and Grassley and Collins and Snowe and Voinovich – those five have been the most receptive to the Democratic amendments thus far – but why would they hold the vote needing 60 when two Democrats will be out of town, and another, Robert Byrd, probably won’t make the vote (he’s been MIA on this bill for the most part)?

What sounds more likely is what Brian Beutler is reporting – that the final action on the bill will be delayed, to protect Blanche Lincoln:

One of the most far-reaching pieces of the Senate’s Wall Street reform bill has powerful enemies. The White House doesn’t like it. FDIC chief Sheila Bair doesn’t like it. Obama adviser Paul Volcker–the patron saint of financial reform–doesn’t like it. And neither do a number of key Democrats, including Banking Committee Chairman Chris Dodd. All of them say that a controversial proposal to force financial firms to spin off their derivative-trading desks into separate entities goes too far.

But they may have gotten themselves stuck with it–at least for now. With their assent, the plan was authored by Sen. Blanche Lincoln (D-AR), who designed it to guard her left flank against a somewhat formidable primary challenge, and has been boasting of it on populist grounds for weeks. And that according to Republican and Democratic Senate sources, has led Democrats to quietly agree to postpone any changes they decide to make to her proposal until after this Tuesday’s election has passed, to avoid embarrassing her in front of voters.

My working assumption was that the derivatives piece would get gutted in conference. The House piece on derivatives, frankly, sucks, and something like Lincoln’s bill might not even pass over there. But I think they’ve basically worked themselves into a corner on this bill – they might not even have the votes to pass it, given that Lincoln and Specter will probably fly the coop on Friday and not come back until after their elections.

Point being, the Senate club is protecting Lincoln. I heard a speech the other day on the Senate floor from Chris Dodd that reflected this, talking about how nobody is a better champion for their state than her, etc. I don’t think Arkansans will really care about a speech like that, but the derivatives bill has probably helped her. It’s the height of cynicism that nobody expects it to survive intact.

UPDATE: Ezra Klein has a fuller list of amendments for today, including Dick Durbin’s amendment on interchange fees, that Brownback amendment to exempt car dealers from the CFPA, and more.

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David Dayen

David Dayen