After weeks of debate, the Senate voted on a financial regulatory reform bill late Thursday night with 59 senators voting for it and 39 against it. There were hundreds of proposed amendments to the bill under consideration, but one in particular had caused quite a stir, and it had to do with auto dealers.
Sen. Sam Brownback (R-Kan.) had proposed auto dealers be exempted from regulation under a consumer financial protection agency meant to oversee consumer loans and products. In effect, about 80 percent of auto dealers who are not direct lenders of auto loans would not be subject to the agency’s rules.
Auto dealers around the country hailed the amendment, including the National Automobile Dealers Association and the American International Auto Dealers Association, which incidentally was hosting its yearly summit this past week in Washington, D.C. Auto dealers from all over the country converged for the meeting and were also hoping to make their voices heard one last time on the Hill before the bill was voted on.
Auto dealers spent more than $2.3 million in political contributions in the 2010 election cycle, and dealers are no small market. It is a business that is larger than the credit card industry, and is valued at more than $850 billion, according to the Cambridge Winter Group.
But something funny happened last night. The amendment was never voted on, and in fact, it was never even considered.
According to this Washington Post article, there was some political maneuvering in the moments leading up to the big vote. The Brownback amendment became linked with another controversial amendment introduced by Sen. Carl Levin (D-Mich.) and Sen. Jeff Merkley (D-Ore.) that would ban proprietary trading by banks. That amendment was very strongly opposed by Senate Republicans.
“It looks as though the GOP leadership didn’t want Merkley-Levin to come to a vote,” says Raj Date, the executive director of the Cambridge Winter Group, a nonpartisan financial policy think tank. “So they persuaded Brownback to withdraw his amendment on auto dealers.”
So now what? The auto exemption fight is not quite over. The House had voted for an auto dealer exemption back in December in their version of the bill, so there’s still some negotiating that’s going to take place between the House and Senate in a conference committee next week.
However, according to Raj Date, it will be harder to know which way the committee will go. “The odd thing about the conference is that it’s not like it’s on C-Span — it almost certainly will be out of public view so the horse trade will be more difficult to get a handle on.”