Two Key Dems Throw Cold Water On Bankruptcy Bill
Sen. Dick Durbin announced Monday night that after weeks of negotiations between Senate Democrats and the financial industry, a compromise had been reached on bankruptcy legislation -- but it remained to be seen whether that compromise would win 60 votes.
On Tuesday, a key Democrat came out against the compromise bill, which would allow judges in certain circumstances to modify mortgage terms -- a process known as cramdown. Meanwhile, a second crucial Democratic vote said that he doubted the bill had enough support for his vote to decide it one way or the other.
Sen. Mary Landrieu (D-La.) spoke poorly of Durbin's compromise proposal, which is now being circulated. "I don't think it's much of a compromise," Landrieu told the Huffington Post. "My community bankers are really opposed to it and I think it's important for people to realize there is a big difference right now in the country between the health of these large international financial institutions and our local community banks...I think we gotta be careful about adopting processes and procedures that would really hurt our community banks."
Asked if she was a definite no, Landrieu responded that she was "pretty close to a definite No."
Sen. Evan Bayh (D-Ind.) wouldn't say whether or not he supported the compromise, but he nevertheless expressed deep skepticism.
"My concern about this is that in our appropriate zeal to help the four or five percent of Americans who might be faced with bankruptcy, we don't unduly raise the costs of homeownership on the 95 percent who never will," Bayh, who supported the legislation last year, told the Huffington Post.
Backers of the bill say that they are close to getting the 60 votes needed; Bayh and Landrieu are key votes needed for passage. Bayh, however, painted a much more pessimistic picture, saying that he was unlikely to be the deciding vote.
"I'd be surprised if that were the case," he said. "There's been a tendency on the part of some who are advocates for the legislation to overestimate the number of votes in favor...When I was actively involved at the moment it broke down it was my impression there were no Republicans who were willing to support it and at least a few Democrats have stated openly on the record that they were in opposition. How you get to 60 with those numbers is a mathematical problem."
Sen. Jon Tester (D-Mont.) previously told the Huffington Post he opposed cramdown, dealing a blow to the bill, but he has yet to comment on the new compromise package.
Bayh, who has not been a principal negotiator over the last several weeks, said that he has not yet been briefed on the compromise and didn't rule out voting for it. "I'm not opposing anything -- I was one of 36 -- I voted for it. I was for getting something done in this area," he said, referencing his previous vote in support.
"But if we're not intelligent about it we're going to raise the cost on the vast majority of Hoosiers who will never go into bankruptcy and that would not be fair to them. I am for getting something done. I voted for it last year and I'd like to vote for it again this year. It depends on what the specifics are."
Ryan Grim is the author of the forthcoming book This Is Your Country On Drugs: The Secret History of Getting High in America