By Libby Casey
Alaska Senator Lisa Murkowski is among the Republicans the White House is trying to work with and mollify over a pending financial regulatory bill. Treasury Secretary Timothy Geithner, making the rounds on Capitol Hill this week to talk financial reform stopped at Murkowski’s office yesterday evening.
Senate Democrats plan their first test of legislation Monday, which will force Republicans to vote on whether to move forward. At least one Republican will have to side with Democrats to stop a filibuster.
Senator Murkowski says the main concern she brought up with Secretary Geithner is over community banks and credit unions, and how they could be caught up in regulations designed for big Wall Street banks. She says small banks in Alaska could get unnecessarily squeezed.
What is coming at them in terms of the reporting requirements, the restrictions, potential restrictions on credit, and really ensuring that the small banks, who were in no way shape or form responsible for any of the meltdown, the crisis we saw on Wall Street, that they don’t end up being punished.
Murkowski says Geithner agreed that new regulations should not jeopardize the ability of smaller banks to offer credit. But Murkowski says the details over compliance concern her and could be deal-breakers.
Alaska’s Democratic Senator, Mark Begich, agrees with his senior colleague across the aisle that community banks and credit unions shouldn’t be stifled.
In Alaska they’re huge economic engines, and there’s no reason they should be overregulated because they did not cause the problem. But these mega banks, these banks that got into everything you can imagine, they’re the ones that crippled this economy and almost sunk economy. They need to be held accountable. And again I can’t emphasize enough, this bill has to ensure now and in the future, we are not going to put taxpayer money in the bucket again.
Begich says he supports the current financial reform efforts, and wants to see more transparency and regulation in the banking industry over hedge funds, derivatives and sub prime loans.
Monday’s Senate vote is over whether to begin formal floor debate over a bill by Connecticut Democrat Chris Dodd. His bill would set up an agency to protect consumers against loan abuses, start a regulatory council to monitor the financial system for risks, and do away with the notion that a bank should get a bail-out because it’s “too big to fail.” Democrats are continuing talks with Republicans – and the shape of the bill could change by Monday. Meanwhile some liberal Democrats say it doesn’t go far enough.