After impasse, a new Senate bipartisan push at taming Wall Street, avoiding financial meltdown

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Dodd finds new GOP partner for banking bill talks

WASHINGTON — After all the talk, some glimmers of real bipartisanship. Senate Democrats and Republicans are looking for a few dry patches of common ground, showing mixed results on a jobs bill and new hope for legislation aimed at avoiding another financial meltdown.

On Thursday, a Wall Street bill that seemed headed for the same partisan heap as health care got help from a junior GOP senator who stepped in to negotiate a deal with Democrats after talks with more senior Republicans broke off.

Sen. Christopher Dodd, the Banking Committee chairman, said he and Sen. Bob Corker, R-Tenn., will work on writing the massive overhaul of bank regulations, still a priority of President Barack Obama as the nation emerges from a jobs-killing recession blamed on lax government oversight of the financial industry.

A week ago, Dodd, D-Conn., had declared talks with top committee Republican Richard Shelby of Alabama at an impasse.

Before agreeing to negotiate, Corker met with Dodd during the height of a winter blizzard Wednesday in Dodd’s Senate office. Corker pulled up to the Senate’s Russell Office Building in his four-wheel drive and Dodd trudged over from his Capitol Hill town house.

“I think we were the only two senators anywhere near the building,” Dodd said in an interview.

The effort, on a day when the rest of the federal government had shut down, underscores what both men say is an urgent need to update the nation’s financial laws. But it also demonstrates the demands of a new political alignment in the Senate, where Democrats alone can no longer control the agenda.

No one, however, was predicting an overall thaw in a bitter partisan atmosphere. Even as a proposal by Sens. Chuck Schumer, D-N.Y., and Orrin Hatch, R-Utah, to give payroll tax breaks to companies that hire new workers was moving forward Thursday, other bipartisan agreements in a jobs bill were falling apart.

The breakthrough in the banking reform bill was especially remarkable because it came after Shelby had made it clear he intended to write his own bill to compete with Dodd’s. Corker, elected in 2006, said he became convinced that under those circumstances, the legislation was headed for a “train wreck.”

“There is enough agreement on the major issues that we can create a bipartisan bill,” Corker said in interview Thursday with the AP.

Dodd said he was more optimistic than he had been in weeks about prospects for a “consensus bill.” He noted that the bill has been helped along by bipartisan working groups within the committee, including work by Corker and Sen. Mark Warner, D-Va., and Sens. Jack Reed, D-R.I., and Judd Gregg, R-N.H.

“What was missing was a partner who’d be willing to sit down and negotiate on a full bill,” Dodd said.

He said he is looking to present a bipartisan bill for his committee to act on by early March.

Corker, a successful real estate developer before entering politics, is regarded as a quick study by his colleagues. He is in regular contact with Treasury and Federal Reserve officials, and he and Warner organized study groups last year to gain insights into the financial crisis. That he is not up for re-election until 2012 also gives Corker a little more freedom to work across party lines.

“People have been running for cover— particularly Republicans— because they are afraid of challenges in the primary,” said Ross Baker, a congressional scholar at Rutgers University. “Bob Corker is in an interesting position. He doesn’t have to face a Tennessee electorate during a period of extremely harsh partisan polarization.”

What’s more, when it comes to banking, Corker doesn’t have the same constituency pressures as lawmakers from states that are headquarters to big bank holding companies.

“We’re not the home to huge banking corporations like some other states would be,” said Bruce Oppenheimer, a political scientist at Vanderbilt University in Nashville, Tenn. “That may give Corker some movement that he might not otherwise have.”

The Senate Banking committee has been working for months to fashion legislation responding to the 2008 financial crisis. Dodd wants the legislation to limit risk-taking by financial institutions and create more transparency in global derivatives markets. He also wants a system to safely take down failing financial giants without burdening taxpayers. And he has embraced Obama’s demand for new protections for consumers.

But the details have been a hindrance, especially on consumer protections. Obama has been pushing an independent consumer protection agency to write and enforce regulations on lending, credit cards and other consumer products. Republicans oppose a separate regulator, leading to the impasse between Shelby and Dodd.

Corker said he talked again Thursday with Dodd and both agreed to negotiate other aspects of the bill before discussing the consumer issue.

Asked if his outreach represented a new trend in the Senate, Corker replied:

“I can’t say grace over the whole gamut of issues,” he said. “What I can say is that I have been highly involved in the banking committee and in financial regulation. The uncertainty is worse. The uncertainty is not knowing what the regulation is going to be.”