Bipartisan accord on financial provisions

May 6, 2010 at 12:00a.m.

McClatchy Newspapers

WASHINGTON

The Senate on Wednesday voted 93-5 to revamp how regulators can dissolve large financial firms that are dubbed “too big to fail,” a rare bipartisan agreement that replaced a controversial proposed $50 billion bank-financed fund to help break up ailing companies.

The Senate also voted 96-1 to guarantee that no taxpayers’ money will be used to bail out financial institutions, a stand of political cosmetics since no bailouts are contained in the legislation. Those tallies kicked off Senate voting on the historic bill that would overhaul how the government regulates and oversees the nation’s financial institutions.

The votes were important steps, since the agreement on breaking up big firms resulted from months of talks by leaders of the Senate Banking Committee from both political parties. Instead of the partisan rancor that’s dominated Congress for years, lawmakers are signaling this time that they’re willing to compromise on one of 2010’s biggest legislative challenges.

Senate Banking Committee Chairman Christopher Dodd, D-Conn, hailed the votes as a “fundamental change in our country’s ability to protect taxpayers from the economic fallout of having a large, interconnected firm collapse.”

“This is very positive,” said Sen. Judd Gregg, R-N.H.

The House of Representatives passed a similar bill last year, and President Barack Obama hopes to sign final legislation this summer, but significant obstacles to Senate passage remain.