Back at the Conference Table Once Again

In another surprising turn of events, The Restoring American Financial Stability Act, HR 4173, has apparently been sent back to conference again as of 5:00 P.M eastern time. Politico is reporting that the House and Senate had to reopen the conference committee to deal with the issue of an additional $19 billion in new taxes which were going to be levied on financial institutions. This was a last minute addition to the bill which was made early on Friday morning just before the bill left conference committee.

The problem now is that with that additional tax, the bill's proponents do not have the votes to pass it. Scott Brown (R-MA) stated that he would not vote for the financial reform with this tax, which he believed would be passed on to consumers. Apparently some of his colleagues including Olympia Snowe (R-ME) and Susan Collins (R-ME) agreed, so with Robert Byrd's death early yesterday morning, Dodd and Frank are now more than one vote short.

The solution--scrap the tax and instead shut down the TARP bailout program and use the remaining TARP funds to offset the cost of the bill. Dodd is quoted by Politico as saying, "My hope is that our colleagues will see this as a more attractive pay-for proposal than the one we adopted at about 4 or 5 in the morning, the biggest piece being the elimination of TARP which would raise about $11 billion." My question would be, if legislators needed $19 billion to fund this bill, and TARP can contribute only $11 billion, where is the other $8 billion going to come from? Maybe someone will think to ask that question tonight.

Also, I was under the impression that unused TARP funds were supposed to be returned to the Treasury or used to pay down the deficit--not transferred over to other projects to be spent as a discretionary fund for Congress. Maybe somebody could ask about that too.

The good news is that since Robert Byrd's body will lie in state on Thursday and his funeral will take place Friday, a vote before the 4th of July recess now appears unlikely. Even the White House now seems to understand that the vote will probably happen after the House and Senate reconvene on July 12.

And that gives the American public a little time to weigh in on this issue if they want to. A full text of the final conference bill is available on a link on www.libertycentral.org. I recommend that everyone go there and read the bill. It is over 2315 pages, but this is a long weekend, and this legislation is going to impact all of us for a long time to come.

Tomorrow and Thursday we will discuss some of issues and items that made it into the final conference bill which is about to become law.