The Wall Street reform fight enters its final stages in the U.S. Senate this week with an overdue reckoning on three issues that cut to the heart of how, and for whom, the financial system works.
Although a final vote is expected within days on the White House’s top domestic priority, lawmakers have yet to settle disputes on regulating over-the-counter derivatives; curbing risky trading by banks; and the power of state authorities.
There will need to be resolution on these topics before the Senate can approve a Democratic bill designed to make the financial system less prone to crises like that of 2007-2009.
Analysts say that could occur as soon as tomorrow or Thursday. Delays could postpone full approval to next week, however.
Major votes on amendments looked unlikely today, due to primary elections involving senators Blanche Lincoln and Arlen Specter, both Democrats. Party leaders were expected to avoid close votes on controversial measures while the two were away on the campaign trail.
The bill aims to prevent the kind of financial turmoil that tipped the economy into deep recession in 2007, and which academics say has become more common since a wave of deregulation in the 1980s.
For President Barack Obama, the stakes are high. He is a staunch advocate of tighter rules for banks and capital markets following the crisis and the politically explosive taxpayer bailouts of Wall Street that ensued.
Whatever the Senate produces will have to be merged with a reform bill approved in December by the U.S. House of Representatives.