Second Verse Same As The First
by digby
Yesterday Mitch McConnell and John Kyl came out swinging with a classic Luntzian bizarroworld ploy, declaring that the financial reform bill institutionalizes Too Big To Fail and therefore the Republicans have no choice but to vote against it. It was a bold move, pretty much guaranteeing sputtering and shock on the other side as Senate Democrats reeled from the cognitive dissonance.
Here's the smarmy Judd Gregg laying out the parameters of the debate on MSNBC this morning:
Judd Gregg: There really isn't a lot of partisanship in this bill, it's just an issue of trying to get it right, making sure Too Big To Fail doesn't exist, making sure we have good derivatives language on the issue of consumer protection, language on how we move around the regulatory regimes here.And I honestly thought we were going to reach a consensus bill her. For reasons which I'm not entirely clear about it's blown up into one of these political debates where the substance of the debate is sort of overwhelmed by the language, which is very hyperbolized.[He's talking about Chris Dodd here, not Mitch mcConnell --- ed.]
MSNBC anchor: Well there's also huge disparity between that which Senator Dodd is saying and that which Senator McConnell is saying because the latter is saying that this bill will lead to endless bailouts of Wall Street. Is that true? This wouldn't end it?
Gregg: Well the Dodd bill does have some problems on the issue of Too Big To fail in that it sets up a process where the treasury or the FDIC could keep alive a bank or a finacial institution which had gotten into significant financial trouble.Whereas the agreed to language which was supported by Republicans and a lot of Democrats, the Corker/Warner agreement, which wasn't included in the Dodd bill essentially required that any financial institution that got into trouble would have to go into a process of what amounted to bankruptcy and would not survive. And that's the course we should take, of course. We've got to end TBTF as a concept because it perverts the marketplace. It means that capital is not flowing pursuant to what they see as a risk, but what they see as a taxpayers coming in to support and that's not healthy for the economy.
This is utter nonsense and Gregg knows it. But he is playing an important role in the kabuki dance: "the broker:"
MSNBC anchor: So do you think there's room for compromise in the Senate on this?
Absolutely there is. The question is how do we get back to the table. I think Senator McConnell is absolutely right. He's saying, hey talk to us on this issue. If you're not going to talk to us then we're not going to support taking the bill across the floor and we'll use our capacity to stop the bill, but what we really want to do is sit down and reach agreement because these agreements should be very doable.
Yeah sure. As Ezra reported this morning:
[I]f you're looking for help predicting the ultimate amount of bipartisan cooperation on this bill, the fact that Cornyn and McConnell are basing their fundraising strategy around their opposition to financial regulation should offer a clue.
Judd's job is to ensure that the bill is watered down to something that Wall Street is happy with, but which Republicans can still vote against in the end, this time saying "it doesn't go far enough." It worked with health care.
The difference this time is that liberals are not nearly as invested in this bill as they were in health care. There could easily be defections on the left if they water this thing down any more than it already is. Nobody's life is literally at stake and Obama can't keep going to the "my legacy depends on it" well.
The Dems would do better politically to tell the Republicans to go to hell, pass a tough bill and take it to the people. Conservatives voting against financial system reform are in a much more difficult political position than liberals because everyone knows that Republicans are the party of big business and have been for a century. They'll try to muddy it up with cries of socialism, but only the veriest teabagger will be able to absorb the dissonance in all this without their heads exploding. If the Democrats allow the GOP to water down their bill even further so they can then vote against it in a faux populist hissy fit, they get what they deserve. They'd be better off walking away and running the fall campaign on the GOP's obsequious obeisance to Wall Street bankers.
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