Democrats Pull Bank Tax To Move Legislation Forward

In an effort to bring the financial reform bill back from the brink of collapse, Democrats in the House and Senate altered the formula that would have paid for the legislation, thus removing a contentious $19 billion tax that would have been placed on large banks and hedge funds.

Congress instead agreed to pay for the bill with money generated by the Troubled Asset Relief Program, which was the $700 billion taxpayer bailout that was put in place in the fall of 2008 to save the financial system.

The concession was made as Democrats are trying to appease as many of the centrist Senate Republicans as possible to gain the 60 votes needed and avoid the expected filibuster to delay the bill.

Senate Banking Chairman Christopher Dodd, Connecticut Democrat said that "My hope is my colleagues will see this as a more attractive" approach, when talking about the three Republicans that had supported an early version of the bill in the Senate. "But obviously, until they actually cast a vote, you never know."

"I believe if you take out the new bank tax, on balance, it would improve our financial system, and I would support it," said Sen. Susan Collins of Maine, one of the Republicans that is on the fence and threatens to derail the financial bill that has been in the works for over a year.

Democrats will also have to regain the support of Washington Democrat Senator Maria Cantwell, who voted against the Senate version of the bill last month saying it was not tough enough on the banks.

In the Democrats are unable to gain the 60 votes needed, they will have to wait until West Virginia Democratic Governor Joe Manchin to appoint a successor to Senator Robert Byrd who recently passed. There is currently no timetable in place for a decision from Manchin.

You May Also Be Interested In

• Byrna Technologies adds former Axon board member to its board
• Enbridge forms C$2.7B joint venture with KKR and Apollo
• KKR agrees to sell USI Insurance Services to Aon for $17B