The Senate Banking Committee, after months of negotiations, finally came to bipartisan agreement on Monday evening, but it wasn't over the contents of financial reform legislation: The two parties agreed to skip the committee process and head straight for the Senate floor.
Chairman Chris Dodd (D-Conn.) brought an amended version of the Democratic bill to the committee, where it faced hundreds of amendments from both sides. The debate that was expected last week -- a protracted affair in which Republicans and Democrats slugged it out over issues like consumer protection, derivatives and ending Too Big To Fail -- fizzled within 18 minutes of Dodd beginning his opening statement. The senators who assembled outside the hearing room to answer questions from reporters gathered for about 10 minutes. The bill -- which touches on nearly every facet of finance -- passed out of the committee by a 13-10, strictly party-line vote.
Now that the bill is headed to the floor, Dodd said later on Monday, before heading to the White House for a health care meeting, he'll reach out to Republicans off the committee such as Sens. Olympia Snowe (Maine) and George Voinovich (Ohio), who are more likely to cut a deal. "Absolutely," he said when asked of those two members. "It's a broader audience that's going to be interested in it."
Dodd said that the panel's top Republican, Sen. Richard Shelby of Alabama, had signed off on the decision to punt on the amendments.
"They had a bunch of amendments, frankly, that I would have taken, but they didn't want to offer them," he said. "I left it up to them. If they wanted to offer the amendments, it was fine. I was going to be there and do it all night today and tomorrow [and] Wednesday."
Dodd preferred it this way. "We avoided the acrimony and the polarization that can occur on a subject matter like that. So many people have been so involved in this process, everybody knows where everybody is," he said. "This avoids the hardening."
Shelby said a bill to his liking "continues to elude us today... Therefore, I do not view today's mark-up as the end of the road, rather as just another step in the process," Shelby said.
Sen. David Vitter (R-La.), who had been ready with a basket of amendments, told HuffPost the GOP members had all agreed to wait for the floor and the negotiations that will come first. "Basically, we all decided to forego amendments to keep working on a bipartisan bill. We'll just oppose this bill moving forward unless we have this deal," said Vitter.
If the committee had gone forward with a debate on amendments, it could have dragged on for quite some time.
A total of 79 Republican amendments would have done nothing more than change dates in the committee's legislation: Vitter had 14 amendments that would have delayed the implementation of the bill by periods ranging from 12 to 25 days. Sen. Jim Bunning (R-Ky.), meanwhile, offered 25 different amendments that would "change the effective date" of legislation. Sen. Jim DeMint (R-S.C.) had 15 of his own amendments he wanted considered, each changing the effective date by a range of anywhere between one day and 15 days. Sen. Mike Johanns (R-Neb.) had a similar brainstorm and had 25 amendments to offer changing various effective dates.
Shelby, during the brief mark-up, was critical of the bill, particularly a section dealing with ending Too Big To Fail. The Alabama Republican said the bill in its current form "expanded the problem of Too Big To Fail." The bill also "still falls short of ending bailouts and associated moral hazards." The committee passed the bill shortly thereafter.
Vitter said that, without a deal, the GOP will argue that their opposition was justified and will claim that the bill "enshrines" the system in which some banks are "Too Big To Fail."
"I don't think this bill is going anywhere on the floor," Vitter said. "Based on a number of things, starting with the fact that this bill, the current version, still enshrines 'Too Big To Fail,' doesn't replace it, I think we can absolutely block this on the floor."
Rather than debating these issues in the committee, the senators and their staffs will now go back to negotiating in public, through the media.
Kicking that off, HuffPost asked Dodd to respond to Vitter's charge that his bill enshrines "Too Big To Fail."
"We have virtually eliminated Too Big To Fail in that bill. They can say it all they want, but the fact of the matter is, that assumption is gone in this bill," Dodd said. "Believe me: the presumption is bankruptcy."
Republican Sen. Bob Corker of Tennessee told HuffPost prior to the committee's meeting that, "You're probably going to witness one of the most dysfunctional committee meetings in Senate history."
After the hearing, he said he was satisfied with the decision to move forward and skip the committee debate. "There were a lot of discussions about the pros and cons" of fighting in committee, he told reporters in the Capitol. "Every Republican amendment that was going to be offered most likely was going to be voted down. That was going to take us no place. And I don't think any of us came here just to stick a stick in the eye of colleagues. So I think a more productive route is the route we've taken."
Corker, told by HuffPost of Vitter's concern, said he agreed that there is "some tightening up that needs to take place." But in general, he said, the bill does not enshrine "Too Big To Fail."
"In general, the concept there is good," he said. Dodd's bill would force failing banks into bankruptcy and liquidation. "Overall, I agree generally speaking with what's been laid out."
"Senator Shelby had it right -- it's going to take time," Dodd told reporters after the roughly 18-minute meeting ended. Dodd said the panel hopes to reach a compromise before it gets to the floor, in the next "couple of weeks," he said. Corker's timeline was 60 to 90 days, Corker said.
Sen. Mark Warner, a Democrat from Virginia, said the new development "may enhance the chances to get a bipartisan bill before it gets to the [Senate] floor."
Shelby told reporters that the reason why the senators couldn't debate the bill in committee and reach common ground was because "it couldn't be settled here."
Last week, the American Bankers Association's top lobbyist, ABA President and CEO Ed Yingling, said that every week that passes gives Shelby and the Republicans "more leverage."
Republicans will have the upper hand in negotiations over critical issues like the creation of a new consumer-focused agency -- dedicated to protecting borrowers from abusive lenders -- with every passing week, he indicated. Republicans and bankers strongly protest the creation of a new consumer-focused entity, arguing that it will impact bank profitability and eventually limit the amount of credit available to borrowers. Consumer advocates say a strong protector is needed in the wake of the biggest financial crisis since the Great Depression, triggered by delinquencies and defaults on predatory and abusive mortgages.
Dodd, Shelby, Corker and Warner all said they were confident they'd reach consensus before the bill hits the floor.