Friday’s Headlines: House Is Close to Passing Financial Overhaul Bill

House leaders moved closer Thursday night to approving a sweeping overhaul of the country’s financial regulatory system.

If enacted, the bill “would mark the largest revamp to the country’s financial regulatory regime since the Great Depression,” reports the Washington Post, adding, it “would create a new agency dedicated to consumer protection, establish a council of regulators to police the financial landscape for systemic risks, install oversight of the vast derivatives market and give the government power to wind down large, troubled firms whose collapse could endanger the entire financial system.”

Lawmakers considered 36 amendments to the Wall Street Reform and Consumer Protection Act, including a proposal to allow the federal government to preempt state regulation.

One such amendment, by Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee, included a measure to steer $3 billion from the government’s Troubled Assets Relief Program to mortgage relief for jobless Americans, as well as $1 billion more for grants to state and local governments to purchase foreclosed properties, reported the Post.

A final vote is expected today. We’ll have more on the bill on the NewsHour this evening.

In other financial news, TARP “pay czar” Ken Feinberg will release new guidelines Friday morning. Politico reports, “Out of a total of 450 people covered by the new ruling, fewer than 10 will be allowed to earn more than $500,000 per year.” Anyone making more than that has to demonstrate why they deserve a heftier pay check. “The tough new pay rules help explain why some banks have been scrambling to get out of TARP ASAP,” says Politico.

Also, Goldman Sachs CEO Lloyd Blankfein and other Wall Street executives are expected to meet with President Barack Obama on Monday to discuss the financial meltdown and how to avoid another one in the future. Perhaps in preparation, Goldman Sachs on Thursday moved to squash uproar over pay bonuses by declaring that most senior employees will forgo cash bonuses this year, reports the New York Times. Instead, they will receive long-term stock options over several years. The controversy is far from over, says the Times. In 2009 alone, the financial firm set apart a record $16.7 billion to pay its workers — approximately $700,000 per employee.

  *   Blackwater guards have been linked to clandestine CIA raids, including operations against suspected insurgents in Iraq and Afghanistan and the transporting of detainees, [according to the Post](http://www.washingtonpost.com/wp-dyn/content/article/2009/12/10/AR2009121004700.html). The private security guards played a central role in nightly raids from 2004 to 2006, aiding in “snatch and grab operations,” said intelligence officers. Blackwater’s role is raising concerns about the extent to which private companies have colluded with government agencies, and whether that relationship is kosher. Rep. Rush. D. Holt, D-N.J., chairman of the House Select Intelligence Oversight Panel, [told the Times](http://www.nytimes.com/2009/12/11/us/politics/11blackwater.html) that “the use of contractors in intelligence and paramilitary operations is a scandal waiting to be examined.”   *   The European Union pledged $3 billion over the next three years to help developing nations tackle climate change. [The BBC reports](http://news.bbc.co.uk/2/hi/europe/8407112.stm) that the United Kingdom is shelling out the biggest portion, promising $800 million. EU leaders hope the donation may boost talks in Copenhagen, where 100 world powers are gathered. British Prime Minister Gordon Brown indicated that the EU is also seeking to reduce deforestation 25 percent by 2015.