As President Obama prepares to go to Wall Street Thursday to push for more controls over America's financial industry, U.S. Sen. Bob Corker, R-Tenn., on Tuesday dismissed Democratic claims that their financial reform package will punish Wall Street.
"To act like this is tough on Wall Street is laughable," he said. "I'm sure they will be hoisting (Obama) on their shoulders once this bill passes."
Sen. Corker, who has been a key negotiator in trying to draft a reform plan with Senate Banking Committee Chairman Chris Dodd, D-Conn., initially criticized both Democrats and Republicans for framing the financial regulatory debate for political gain against one another.
"To say you are either with me and against Wall Street or you are against me and for Wall Street is just a silly debate and one that is beneath the topic," he said.
By the end of the day Tuesday, however, Mr. Corker and others in the Senate said they hope a bipartisan agreement may yet be reached on a reform package to avoid a repeat of the financial meltdown that caused the Great Recession.
"I think we're headed to a place where this drama can be resolved peacefully," Sen. Corker said.
Senate Majority Leader Harry Reid, D-Nev., said that he may wait to bring the bill to the floor until early next week to give Sen. Dodd and the ranking Republican on the Senate Banking Committee, Richard Shelby, more time to strike a deal.
The reform plan will add more transparency to financial derivatives to help ensure there is an appropriate market and adequate backing for such instruments. But the clearinghouses for such exchanges will still likely be owned by Wall Street, Sen. Corker said.
"All you are doing is strengthening their plumbing," he said.
What's next?* President Obama will speak in Manhattan Thursday on the need for financial regulatory reform.* Senate Majority Leader Harry Reid said Tuesday he wants to bring financial reform to a vote of the full U.S. Senate late this week or by next week* A Senate bill, if adopted, must be reconciled in a conference committee with the House financial regulations bill adopted in December and then both chambers must approve any compromise package before it may be signed into law by President Obama.
Mr. Corker said he is disappointed that the financial reform bill approved on a partisan vote in the Senate Banking Committee last month doesn't require Wall Street firms to honor the representations and warranties they make to investors regarding mortgage-backed securities. The measure also
doesn't address problems with the initial underwriting of loans, which Mr. Corker said is key to any reform plan. Mr. Corker said private equity funds and hedge funds also are left out of the bill.
"I'm not happy with the rhetoric on the Republican side or the rhetoric on the Democratic side," he said. "What we need to do is finish working on this bill, not to harm someone, but to put in place the mechanisms to make sure we have more transparency and a better system and avoid the kind of problems we had over the past few years."
The Obama administration continued to woo Republican senators on Tuesday, sending Treasury Secretary Timothy Geithner to Capitol Hill for another round of meetings with four more GOP leaders, including Senate Republican Caucus Chairman Lamar Alexander, R-Tenn.
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