Senate passes Dodd-Frank reform

Senate passes Dodd-Frank reform

The vote means the 2,300 page bill can finally become law. But it will be years before its full impact becomes known. The bill covers many areas of finance, from monitoring systemic risk to winding down banks to over-the-counter derivatives.

The House of Representatives passed the bill on June 30 by 237 vote to 192. All but three Republicans opposed it. However, it proved impossible to get the bill through the Senate before the July 4 holiday, because the Democrats could not immediately secure the 60 votes they needed.

Over the last few days those have fallen into place. When Senate majority leader Harry Reid scheduled the vote earlier this week, he gave a public display of optimism.

And Senator Christopher Dodd, chairman of the Senate Banking Committee and one of the authors of the bill, said: “I believe we have 60 votes, otherwise we wouldn’t be going forward.”

This view gained credence when US President Barack Obama announced on his official Twitter page: “We’re on the verge of victory on Wall Street reform”.

Several key players have come into line behind the bill this week. Senator Ben Nelson, a conservative-leaning Nebraska Democrat who originally opposed the bill, has changed his mind.

I will support the Wall Street reform bill to end bailouts, add common sense consumer protections and make sure that Nebraska Main Street businesses are not adversely affected as we rein in recklessness on Wall Street,” Nelson said.

Several Republicans have also broken ranks. One is Scott Brown from Massachusetts, who announced on his website: “I decided that while the bill was far from perfect, it was vastly improved from the version we started with at the beginning of this process.”

Brown’s quandary about supporting the legislation was one of the main reasons why Democrats made the last change to the text, when a $19bn bank levy to pay for financial clean-up costs was removed at the end of June.

Senator Olympia Snowe, (Republican, Maine) also supported the bill. “After thoroughly reviewing the 2,315-page financial regulatory reform conference bill during the July 4 work period, I intend to support passage of the legislation when it’s brought before the Senate for consideration,” Snowe said. She criticised her own party for its lack of support for the Dodd-Frank proposal.

Colin Packham, Sydney

Click here for FOWs analysis of some of the Act's provisions.

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