Deja vu, again

By ANTHONY HALL, United Press International   |   April 28, 2010 at 8:00 AM   |   0 comments

The votes looked the same, as did some of the rhetoric, as Republicans in Washington blocked debate on financial reform for the second straight day Tuesday.

The procedural vote to bring the 1,400-page bill to a formal debate on the Senate floor was blocked with a 57-41 roll call vote with even the same number of abstentions (two) as the day before and the same breakaway Democrat, Sen. Ben Nelson of Nebraska, whose relationship with Berkshire Hathaway received even more scrutiny from the Wall Street Journal.

The Journal reported the firm belonging to Warren Buffett was Nelson's biggest campaign contributor and Nelson and his wife owned $6 million in Berkshire Hathaway stock just two years ago.

Nelson denied his vote was simply a matter of protecting a pal, despite reports that a tweak in the derivatives trading portion of the bill would save Buffett a bundle. (That tweak would be to exempt those with current positions in derivatives from having to pony up large cushions to cover possible losses.)

That led to the biggest rhetorical shift of the day, which was a renewed emphasis on how the bill would affect the average citizen.

"It doesn't matter if it's the second-richest person in the world or a person on the street," Nelson said.

Republicans picked up on the populist theme. As Sens. Richard Shelby, R-Ala., and Christopher Dodd, D-Conn., went back into negotiations, minority leader Mitch McConnell, R-Ky., said: "Most Americans thought this was all about Wall Street. But as you look at the bill closer … you see that it is mostly about Main Street."

Sen. Sam Brownback, R-Kan., said the bill was "so broad in its scope and sweep that it grabs a whole bunch of entities that are beyond the target."

Beyond the rhetoric, Dodd and Shelby were negotiating points that have been debate fodder for months, including how much power to give a new financial consumer protection agency and how to dismantle too-big-to-fail companies in the future without using taxpayer funds.

Investors Tuesday had plenty to distract them from the stalemate, as credit-rating agency Standard & Poor's downgraded Greece's debt to junk status, which put an international rescue effort in jeopardy.

After months of drama, Greek Prime Minister George Papandreou said Friday Greece would apply for European Union and International Monetary Fund loans to help dig itself out of debt, which was recently revealed to have reached 13.6 percent of the country's gross domestic product in 2009.

On Tuesday, he said, "I am determined to do whatever it takes, when it is needed, to revive our country," which may require even tougher austerity measures.

The reaction to Tuesday's downgrade was swift on Wall Street and Main Street. In Greece and Portugal, which also found its credit status lowered, workers took to the streets protesting government cutbacks, real and imagined. In stock markets, the Dow Jones industrial average slumped 1.9 percent, losing 213 points to 10,991.99.

Markets also shuddered in Asia and Europe. In Japan Wednesday, the Nikkei 225 index, which lost 0.42 percent Tuesday, fell 2.57 percent, while the Shanghai composite index in China lost 0.26 percent. The Hang Seng index in Hong Kong lost 1.47 percent, while the Sensex in India dropped 1.76 percent.

The S&P/ASX 200 in Australia lost 1.17 percent.

In midday trading in Europe, the FTSE 100 in Britain fell 0.24 percent, while the DAX 30 in Germany lost 0.75 percent. The CAC 40 in France dropped 1.07 percent Wednesday, while the pan-European DJ Stoxx 50 fell 0.43 percent.

Topics: Ben Nelson
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