The passing of Senator Edward Kennedy threatens to shake up committee chairs in the Senate and in the process may deal the banks the upper hand in their fight with new regulation.
Senator Christopher Dodd who chairs the Senate Banking Committee is in line to succeed Kennedy as chairman of the Health, Education, Labor and Pensions Committee. The man who is in line to replace Dodd is Senator Tim Johnson from South Dakota.
Dodd is likely to make the move though he isn’t obliged to do so, but given some of the ethical questions surrounding him and his finances, he might well want to avoid the spotlight of a bruising fight involving the banks.
Johnson is widely regarded as a friend of the banks. South Dakota is home to Citigroup’s (NYSE:C) credit card processing unit and other large banks maintain operations in the state. Johnson lobbied against the new credit card legislation and was the only Democrat to vote against the bill.
If this shuffling of chairs comes to pass then it is only going to make the road to any real reform that much more difficult to traverse.