Apr 28 2010

SHELBY: NEGOTIATIONS WITH DODD REACH IMPASSE

Progress on Ending Bailouts and “Too Big to Fail” Meaningful but Insufficient

U.S. Senator Richard Shelby (R-Ala.), today made the following statement regarding financial regulatory reform negotiations.

I thank Leader McConnell and my Republican colleagues for providing an opportunity for my negotiations with Chairman Dodd to run their course.  I believe we owed the American people our best effort to make whatever changes we could to this incredibly complex piece of legislation because it will have wide ranging implications for our economy.  Chairman Dodd has assured me that he will address a number of concerns I have expressed with respect to ending bailouts.  We have been unable, however, to make any meaningful progress on other important components of the legislation.  It is now my belief that further negotiations will not produce additional results.

“This bill still contains a sprawling new consumer protection bureau that will find and force its way into facets of our economy that had nothing to do with the housing crisis.  This massive new bureaucracy would have unchecked authority to regulate whatever it wants, whenever it wants, however it wants.  I am aware of no other arm of the federal government this powerful, yet so unaccountable.  In my negotiations with Chairman Dodd, I have consistently supported strengthening consumer protections.  I have also advocated for a sensible and meaningful role for safety and soundness regulators in this new agency’s operations.  Unfortunately, despite my demonstrated willingness to propose compromise solutions, this sensible step has proved to be a bridge too far.

“Also included in this legislation are critical provisions relating to derivatives.  These provisions, which Democrats developed on their own behind closed doors, were only very recently inserted into the bill.  In fact, I was not provided the opportunity to share my views on a single aspect of the derivatives provision.  While I firmly believe we must end the casino-like atmosphere on Wall Street, I also believe we must protect Main Street’s ability to create jobs and grow the economy.  In my judgment, the provisions as currently drafted would have far-reaching and devastating effects on these businesses and our economy, increasing the cost of nearly every product we use and negatively impacting job growth.

“Although I am disappointed that we have been unable to reach an agreement on across-the-board improvements to this legislation, I appreciate Chairman Dodd’s assurance that my concerns relating to ending bailouts will be included in his bill.  I take him at his word.  While these changes are significant and meaningful, they are not sufficient to garner my support for moving this bill to the Senate floor.  Now that my negotiations with Chairman Dodd have reached an impasse, I thank my Republican colleagues for their support and defer to their individual judgments on whether the Senate begins a floor debate on this bill.”