Bipartisan Banking Reform Derailed

A bipartisan effort to remake financial regulations stalled Tuesday as Republicans and the White House traded barbs. The GOP accused the Obama administration of killing a deal on derivatives trading and Democrats as being soft on bailouts. “They want to jam through a totally partisan bill,” Senate Minority Leader Mitch McConnell (R-KY) said. “And if they do that, and it looks like the Dodd bill, it will guarantee perpetual taxpayer bailouts of Wall Street banks.” The administration fired back, with Deputy Treasury Secretary Neal Wolin saying the bailout charges “aren’t consistent with the plain language of the bill.” And a White House communications aide charged that McConnell was pandering, saying he “reads [GOP pollster Frank] Luntz’s line and follows Wall Street’s orders.” With much of the public angry at big banks, whom they blame for the massive financial crisis in 2008, the issue should be ripe for bipartisan efforts. But disputes from closed-door negotiations are increasingly being made public, and compromise now seems imperiled.