05/26/2010 02:08 pm ET | Updated May 25, 2011

Merkley, Levin Push Reid on Volcker Rule

An amendment to prohibit major banks from participating in proprietary trading with taxpayer-backed money has failed in name but its authors hope it will survive in spirit. In a letter Tuesday, Sens. Jeff Merkley (D-Ore.) and Carl Levin (D-Mich.) expressed disappointment that the Merkley-Levin Amendment was not included in the Senate's financial reform vote last Thursday, but told Majority Leader Harry Reid (D-Nev.) and Banking Committee Chairman Chris Dodd (D-Conn.) that they hope the substance of the amendment will be added during conference committee negotiations.

The senators lamented that "Republicans refused to grant consent to bring the Merkley-Levin Amendment up for a vote under a 60-vote threshold on a day when two Democrats were absent," and called it "stunning" that Republicans withdrew the Brownback Amendment rather than permitting the Merkley-Levin Amendment to come up for a vote as a second-degree amendment to that amendment. "With nearly a quarter of the Senate signed on as co-sponsors, the Merkley-Levin Amendment is recognized as representing a clear, balanced approach to putting the Volcker Rule restrictions on proprietary trading and conflicts of interest provisions into law, while accommodating reasonable banking activities and prohibiting the high risk activities that so damaged the financial markets and economy."

It wouldn't be difficult for Democrats to justify adding the amendment, since it merely enhances what is already included in the Senate bill -- Merkley-Levin requires that the Volcker Rule be implemented, instead of allowing regulators to decide as the current bill does.

Indeed, Senate Democratic leaders have vowed to fight for the Volcker Rule in the weeks ahead.

Read the full letter here.