Bank reform clears hurdle

July 1, 2010 at 12:00a.m.

McClatchy Newspapers

WASHINGTON

The House on Wednesday approved the most sweeping rewrite of financial rules since the Great Depression, and last-minute changes this week appeared to solidify support in the Senate and pave the way for the legislation to reach the White House later this month.

Complications prevented a Senate vote this week, meaning Congress will not meet President Barack Obama’s July 4 deadline for signing his top legislative priority.

The 237-192 House vote split sharply along partisan lines. Only three Republicans voted for the bill — Anh “Joseph” Cao of Louisiana, Michael N. Castle of Delaware and Walter B. Jones of North Carolina. Nineteen Democrats voted against it.

Democrats charged in often-contentious debate that Republicans were protecting Wall Street from tough new regulations designed to prevent a repeat of the financial crisis and end the prospect of future government bailouts.

“You perceive regulation as harmful,” House Majority Leader Steny H. Hoyer, D-Md., told his Republican colleagues. “This bill is about putting the referee back on the field and saying, ‘Obey the rules; don’t trample on the little people;don’t take risk that you expect them to pay for.”’

But Republicans said the legislation was a dangerous expansion of government power that would restrict access to credit by consumers and businesses. They blasted it for failing to address the future of seized housing giants Fannie Mae and Freddie Mac and warned that the legislation would lead to more bailouts through a controversial new federal authority to seize and dismantle large financial firms on the brink of bankruptcy should their failure seriously damage the economy.