Brown switches vote to advance financial regulation overhaul

Posted by Stephanie Vallejo May 20, 2010 03:44 PM
By Matt Viser, Globe Staff
WASHINGTON – Senator Scott Brown switched a key vote from yesterday and joined 57 Democrats and two Republicans this afternoon in advancing a massive financial regulation overhaul.
The Massachusetts Republican said that over the last 24 hours he received assurances – from the chief negotiators in the House and Senate, Senator Christopher J. Dodd, and Representative Barney Frank -- that changes he was seeking would be addressed. Those assurances came during a phone call with Frank last night, while the Newton Democrat was working out in the House members gym. Brown was further convinced during a 40-mile bike ride he went on this morning with Senator John Kerry.
“We recognize that there’s going to be some fixes here, more than likely, and the conference committee,” Brown said after voting. “I’m satisfied that all of our efforts – Senator Kerry and my efforts – will benefit and protect jobs in Massachusetts.”
“I spoke at length over a 40 mile bike-ride with Senator Kerry about it,” Brown added. “He’s a very good athlete.”
Brown’s vote was the key in making the difference after Democrats tried unsuccessfully yesterday to shut off debate and move toward a final vote. Brown was criticized, though not by name, by Senate Majority Leader Harry Reid for breaking his word and not voting for the measure. Reid and Brown met this morning.
Brown said yesterday that he opposed the measure to end debate because he did not have assurances that several changes would be made, including one that would ensure that some of the new regulations would not apply to certain financial institutions.
Brown has tried to protect some of the insurance and mutual fund companies in Massachusetts from falling under the so-called Volcker rule, which could restrict the investment options of large institutions, including preventing them from owning private equity funds.
Brown argues that those restrictions should be designed to curtail the risky bets placed by big Wall Street firms, not the more traditional practices of the Massachusetts-based companies.
One of the key difference-makers was assurances that Brown received from Frank, who told Brown last night that he would ensure that the changes were made in conference committee. Frank, chairman of the House Committee on Financial Services, wrote legislation that the House passed last year and will be the top negotiator in reconciling differences between the House and Senate.
The financial overhaul legislation, which has been debated for several weeks, is designed to crack down on some of the risky practices that contributed to the financial downturn. It would create a consumer protection bureau that seeks to help people avoid trouble with mortgages and credit cards they cannot afford. The legislation would also establish a council that would be charged with monitoring the system for potential problems.
Matt Viser can be reached at maviser@globe.com.