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Financial reforms moving fast

Health-care reform, I often whined, moved too slow. But it's worth taking a step back and noting how remarkably fast financial regulation is going.

Compare the timelines of the two: Barack Obama held the White House summit that officially kicked off health-care reform on March 5th, 2009. Max Baucus formed the 'Gang of Six' in June of that year. The Senate Finance Committee didn't see a bill until September. The House passed its bill until November. The Senate passed its bill in December. Then we went through a couple of months of negotiations and Scott Brown-related delays, and the whole thing finally passed in March of 2010. And what's important about this timeline was that health-care reform was issue #1 for the whole time. It dominated the headlines for about a year.

Now look at financial-regulation reform. The House passed its bill in December on 2009, which was while the country was focused on health-care reform. The Senate Banking Committee passed Chris Dodd's proposal on March 23, 2010, which was still while the country was focused on health-care reform. Expectations are that the bill will hit the Senate floor in late-April. And the media is only beginning to turn its attention to the issue. Complicating matters is that legislatiors, the media, and the public know a lot less about financial reform than they knew about health-care reform. We'd had health-care reform battles before, and the subject is constantly in the news. The regulatory structure housing the financial system is considerably less familiar territory, but there's a lot less time to explain it to the public, or to anyone else.

There's some political upside to that, of course. Health-care reform showed that letting bills sit around gives the opposition time to organize and supporters time to learn what it is they should feel disappointed about. Plus, Democrats want to move this bill before everyone scatters for the election.

But there's a downside, too. There's a lot about financial reform that deserves to be debate, but relatively little time in which to do it. The House has voted on legislation. The Senate is pretty sure of the shape of the legislation it means to vote on. People who wanted a chance to whip up support for something very different than what we've got have a lot less time to get the public, or any other actors, on their side.

By Ezra Klein  |  April 14, 2010; 7:01 AM ET
Categories:  Financial Regulation  
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Comments

This issue is a little harder to demagogue, and it's not a clear winner for either party, so apparently the public debate is going to be minimal. That reflects poorly on how little politicians and the media respect the public, and how low the level of debate is.

Posted by: jduptonma | April 14, 2010 8:25 AM | Report abuse

Thanks for highlighting that the speed at which this legislation is moving, and the relative lack of debate is a huge flaw.

I'll be the first to admit that a general lack of seriousness among Republicans in Congress is a huge part of the problem wrt thin debate. Contingent debt should have a large number of Republicans on board (given that its less heavy handed than what the Democrats seem to prefer right now), but a Google search on 'contingent debt republican' doesn't get far - the fifth result is actually one of your posts in which I comment on contingent debt.

Posted by: justin84 | April 14, 2010 9:05 AM | Report abuse

A whole entire post devoid of FinReg?

I'm so proud of you!

Posted by: pj_camp | April 14, 2010 9:07 AM | Report abuse

Could someone clear something up for me? Everyone's talking about the Dodd bill as "the" bill. Now I hear about Blanche Lincoln putting in tough language on derivatives in her Ag Committee. Is this similar to the healthcare debate, where Dodd's bill is coming out of a committee which has the most jurisdiction over the issue (like Finance did for healthcare) while Lincoln's committee has some jurisdiction, but not as much? And then the bills coming out of their committees will be merged by Harry Reid and brought to the floor? If so, what's the chance that Lincoln's strong derivatives language makes it into the final bill? Is she just posturing, knowing that nothing she does will end up in the final bill?

Or is what Lincoln is doing completely separate from Dodd's bill?

Posted by: MosBen | April 14, 2010 9:41 AM | Report abuse

Fast? The financial collapse was in the fall of 2008. Maybe we'll finally get a finreg bill in the summer or fall of 2010. That's not fast in my book.

Posted by: redwards95 | April 14, 2010 10:14 AM | Report abuse

I'm sorry but I'm with redwards95. Not doing anything for over a year should count.

Posted by: Hopeful9 | April 14, 2010 10:54 AM | Report abuse

Aren't you there for that reason only, Ezra? To educate us for the complex, wonky bills? The situation you are describing here sounds like a perfect journalistic opportunity for folks like you.

Posted by: umesh409 | April 14, 2010 1:08 PM | Report abuse

In this case, 'fast' action is concerning. All the Econ/Fin experts I read and trust (see Ezra's links and baselinescenario's links for a list)are indicating there are still many issues that need a healthy debate and that a FinReg bill is not a "foundational bill that can be sequentially tweaked later", like HCR, but rather a bill that we need to get 'right' as opposed to 'fast'.

Frankly, if (operative word here) we could count on Dems being successful at educating the masses about what's at stake and what's in the bill, while highlighting Republican obstruction, I think a public debate could be useful.

I noticed the while McConnell takes his swipes at the bill, he offered no alternative (viable or not) plan. Does this mean Republicans think that NO Fin/Regs are needed? Now THAT position would certainly be fun to attack in the press for a few months.

Posted by: onewing1 | April 14, 2010 1:20 PM | Report abuse

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