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Dems Fail to Get Cloture on Financial Reform

May 19, 2010 - by Donny Shaw

UPDATE (4:30): After calling off the 2 p.m. vote as originally scheduled and huddling in an emergency meeting, the Democrats came back this afternoon and tried to pass the cloture motion to wrap up the financial reform debate, but failed. The Senate Dem leadership held the vote open for over an hour to twist arms and try to flip some votes in their favor, but in the end the tally was 57-42. Sixty votes were needed to approve the motion.

Sen. Susan Collins [R, ME] and Sen. Olympia Snowe [R, ME] joined with most Democrats in favor of the motion. But Sen. Maria Cantwell [D, WA] and Sen. Russ Feingold [D, WI] voted “no” because they weren’t allowed a vote on their amendment to reinstate a Depression-era rule (Glass-Steagall) requiring commercial banks and investment banks to remain separate. Looks like the Dem leadership will have to let progressives vote on their amendments if they want to wrap up the financial reform debate and move towards a final vote on passage.

So the debate goes on. Amendments will continue to be voted on. Expect another cloture vote tomorrow and each day until it passes. It’s probably going to take at least a vote on the Cantwell/Feingold/McCain Glass-Steagall amendment for the Dems to get there.

Original post below…

Just a quick update here on the goings on with financial reform in the Senate. At 2 p.m. today, Sen. Harry Reid [D, NV] is going to call a cloture vote to limit the debate and amendment process to 30 more hours before a final up-or-down vote on passage must be taken. The cloture vote requires a 60-vote majority to pass. At this moment I would give it a 70% chance of passing. It would set up a final vote from 8 p.m. tomorrow night.

As I reported yesterday, there is a movement afoot to strip Sen. Blanche Lincoln’s [D, AR] derivatives spin-off proposal from the bill. Lincoln’s proposal would force bank holding companies to house their derivatives operations in a separate entity so as to block them from having access to discount Federal Reserve money. In other words, no bailouts for derivatives.

Brady Dennis at Washington Post reports that Banking Committee Chairman and finreg floor manager Chris Dodd [D, CT] was moving an attempt to use a manager’s amendment to replace the provision with a two-year study of it. The manager’s amendment is a 1,400-page substitute containing every amendment that has been adopted during the debate, so that strategy would dodge forcing senators to go on the record for or against the spin-off provision.

But the latest word from sources close to the debate is that Dodd may be withdrawing the amendment due to liberal backlash and instead may be allowing a vote on a separate Sen. Judd Gregg [R, NH] amendment to strip out the spin-off language. Lincoln, having last night gotten herself into a June run-off with Bill Halter, said today on the Senate floor that she is still “fully committed” to the provision and will “fight efforts to weaken it.” Stay tuned.

UPDATE: Here’s the rule on amendments post cloture, from CRS:

No Nongermane Amendments. The Senate does not have a general rule of germaneness for amendments. However, once cloture is invoked, all amendments (and debate) are to be germane to the clotured proposal. Senate precedents state that “the Chair may take the initiative and rule amendments out of order as not being germane without a point of order being made, and when obviously non-germane the Chair may rule the amendment out of order even before it has been read or stated by the clerk.” Senate precedents add that under cloture “one of the tests of germaneness is whether the amendment limits or restricts the provisions contained in the bill. If it is clearly restrictive it would be held germane.”

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