Soon after, Wall Street lobbyists called the office of House Majority Leader Kevin McCarthy urging the Republican lawmaker to drop it, according to three people with knowledge of the talks. The lobbyists told his staff the legislation wasn’t a high priority to big banks and not worth the public backlash being stirred up by Warren, Pelosi and Waters, a California Democrat, the people said.
Republicans proceeded anyway. The bill passed a week later with the support of only 29 of the House’s 188 Democrats. It hasn’t been taken up by the Senate.
Taxpayers at Risk
Even though they lost the House vote, Warren, Pelosi and Waters cemented Democratic opposition to further changes to Dodd-Frank in the process. They built on support gained in the December debate on derivatives, when during a week of TV interviews and press conferences they portrayed Wall Street as putting taxpayers at risk so soon after the financial crisis.
The vocal opposition has affected some Democrats, including Representative Jim Himes, a former Goldman Sachs Group Inc. executive whose Connecticut district is home to major hedge funds.
Himes was an early advocate of repealing the derivatives measure, a change that lets JPMorgan Chase & Co., Citigroup Inc., Bank of America Corp. and other banks keep trading swaps in divisions with government backstops.
Now, Himes is staying away from Dodd-Frank. He told a group of banking lobbyists earlier this month that he won’t be backing any revisions to the law, given the current political climate, according to three people who attended the meeting.
“I’m going to hold off on commenting on Dodd-Frank,” Himes said last week during a brief interview. “I’d rather not weigh into something as controversial as this.”
‘Dodd-Frank a Lightning Rod’
Himes’s office later issued a statement in which the lawmaker said “this is an environment in which proposed changes to Dodd-Frank, meritorious or otherwise, are a lot less likely to get a dispassionate hearing.”