Obama in pledge to call a halt to bank bailouts
US President Barack Obama promised an end to taxpayer-funded bailouts "once and for all" as the Senate prepared to start debating an overhaul of the financial system aimed at restoring confidence in Wall Street.
Mr Obama called on Congress to pass the most wide-ranging changes to oversight of the financial market since the Great Depression and said the changes would help revive the economy and "end the cycles of boom and bust".
"In the absence of common-sense rules, Wall Street firms took enormous, irresponsible risks that imperiled our financial system -- and hurt just about every sector of our economy," he said in his weekly address.
With negotiations between Democrats and Republicans on the details of a 1,300-page reform bill continuing late last night, there were hopes that it could be taken up today.
"We are going to get this bill, I think in the next few days, maybe even by tomorrow, and it's going a major achievement for this country," Senator Chris Dodd, the Democratic chairman of the Senate banking committee, told NBC yesterday. "We need to get on with this. It's 18 months since someone broke into our house and robbed us and we haven't even changed the locks on the door."
Richard Shelby, a Republican senator who has led months of negotiations with Mr Dodd, said: "We are getting there, I think conceptually we are very, very close."
Both parties have vied to portray themselves as the defender of the ordinary man amid voter anger about the billions used to revive banks.
They have also tried to paint each other as Wall Street's best friend.
Republicans and Democrats have accepted large amounts of campaign cash from financial companies in the past and approved deregulations in the late 1990s that created the conditions for the near collapse of the system a decade later.
Republicans said that the bill drafted by Mr Dodd did not do enough to ensure that no institution became so large that its failure would endanger the whole economy.
"The language is not there," said Mr Shelby. "There should be an unambiguous message that you can't be too big to fail."
Republicans have also raised objections to a provision that would set up a $50bn (€37bn) fund to cover the cost of liquidation of failed financial companies, arguing that it would set up a permanent bank bailout. Mr Obama has said the accusation is "simply not true".
The Democrats need the support of just one Republican to proceed. They have 59 out of 100 votes but under the senate's rules require 60. (© Daily Telegraph, London)
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