White House Predicts Republican Support for Financial Reform

WASHINGTON, April 18, 2010— -- Republicans are painting it as another bailout for Wall Street, but the White House is sounding optimistic about passing a financial regulation overhaul bill soon, and even garnering Republican votes.

"We agree on the vast bulk of the things necessary to end too-big-to-fail, protect taxpayers in the future, and that's one reason why I'm so confident," Treasury Secretary Timothy Geithner said Sunday on NBC's "Meet the Press."

The White House's financial overhaul proposal would create a consumer protection office to protect investors, and provide regulation of the complex derivatives that helped lead to the collapse of 2008.

It would also create a $50 billion failure fund, financed by the banks themselves. However, Republicans are calling the fund a "backdoor bailout."

"The American people are saying, we don't want another bailout," Senate Minority Leader Sen. Mitch McConnell, R-Ky., said Sunday on CNN's "State of the Union."

Besides from Republican critics, some economists say the plan may not go far enough to regulate high-risk investing, or to hold enough capital on hand.

"It may help," said Wall Street Journal reporter Damaian Paletta. "But no one really knows until it is put into place."

"The president is only doing what he has to do in these financial reform. Many believe they will not keep us from having another crisis," said Peter Morici, professor at the University of Maryland and former director of the Office of Economics at the U.S. International Trade Commission.

"You can't change the fact that Wall Street can create entities Washington doesn't understand. And no army of new regulators can change that," Morici said.

Without a filibuster-proof majority in the Senate, many wonder if Democrats are headed towards the same kind of knock-down, drag-out fight with Republicans as they had over health care, especially ahead of mid-term elections this fall.

"The present bill is not a good bill, period," Massachusetts Republican Sen. Scott Brown said on CBS's "Face the Nation" Sunday.