WASHINGTON — A major bill to clamp down on Wall Street got thrown seriously off track yesterday by the death of Democratic Sen. Robert C. Byrd — as a group of Republicans who had voted for the bill threatened to bolt over a new $19 billion hit on the financial industry.
Democratic leaders have been planning to push a compromise deal to regulate a slew of Wall Street activities and create a new consumer-protection bureau through Congress this week to get it on President Obama’s desk by July 4th.
The Democratic plan was to assemble the thinnest-possible 60 votes to overcome a Republican filibuster.
The death of Byrd (W. Va.), 92, the longest-serving senator in history, costs the Democrats a critical vote and knocks the presumed yeas down to 58.
They won’t regain their earlier strength until West Virginia’s Democratic governor appoints an interim successor — but that might not happen until next week, as the state untangles a kink in its election law.
In a potentially more damaging setback, three of the four Republicans who voted for an earlier Senate version of the bill are slamming the new fees, which were imposed on banks by a House-Senate conference.
The cash is to pay for implementing the regulations. Republican Sen. Scott Brown of Massachusetts was the first of the Republicans to raise objections about the fees, saying they would be passed on to the banks’ customers.
“I can’t support adding another $19 billion of pass-through taxes to individual consumers, especially in the middle of a two-year recession,” he said yesterday.
Sen. Olympia Snowe (R-Maine) said last night she had “concerns” about the $19 billion, while Sen. Susan Collins (R-Maine) said, “There is much to like in the bill, but I do not like the new $19 billion tax that was slipped in at the wee hours of the morning.”
The bill’s chief Senate sponsor, Sen. Chris Dodd of Connecticut, was set to meet with Snowe and negotiate with other wavering Republicans.
Sen. Charles Grassley (R-Iowa), who previously supported the bill, hasn’t said yet how he’ll vote.
Without Byrd, Democrats need all four Republicans unless they can persuade one of two rebel Democrats, Sens. Russ Feingold of Wisconsin and Maria Cantwell of Washington, to vote for it. But Feingold said yesterday he opposed it because it doesn’t go far enough.