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Grassley’s derivative vote may aid re-election

BY LISA BRAHM | APRIL 26, 2010 7:30 AM

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One local expert says Sen. Charles Grassley’s recent vote on a financial-reform bill could work in his favor in the November elections.

Douglas Dion, a University of Iowa associate professor of political science, said that though Grassley, R-Iowa, broke from his party last week and voted with Democrats on the Agriculture Committee to regulate derivatives, the move put the senior senator in a good position.

“He can influence things, and he has shown to constituents his willingness to tackle Wall Street. But if things don’t pan out, he can walk away,” Dion said.

However, the professor noted, the effect of Grassley backing the bill could be small. He pointed to research that suggests senators typically adopt more moderate voting positions closer to elections, but the effect is smaller for senior senators such as Grassley and others in good position for re-election.

Grassley is up for re-election in November; he is running without a Republican competitor, and the Democratic candidate will not be announced until June 8.

Grassley’s vote related to financial reform made national headlines just before he was in Iowa on April 23 to visit with a class of UI law students working on a one-year project seminar writing a model state statute. The senator said he came to provide resources to students in the class, who are writing a bill on transparency.

And transparency is exactly what Grassley said financial regulation needs.

That’s why he voted yes on April 21 — to strengthen regulations on derivatives, considered by many to be the root of the 2008 financial crisis.

“Derivatives are not being regulated, and they need to be regulated,” Grassley said.

But UI political-science Associate Professor Tim Hagle said Grassley’s re-election bid is irrelevant to his vote, which he noted was more likely a way to signal his willingness to work with Democrats on the issue.

Under the bill, financial regulations would be tightened.

While Grassley voted in favor of this portion, he told The Daily Iowan on April 23 this bill only includes a few points from a wider regulatory overhaul Congress wants to tackle.

“I still intend to push for a bipartisan bill,” Grassley said. “I hope all 41 Republicans stick together.”

Grassley expressed his disappointment that the presented legislation was not bipartisan in a statement released last week.

“The chairman and ranking member had worked for months for a bipartisan bill, but politics thrown into the mix by the White House derailed that effort in the end,” he said in the statement.

While Grassley supported Sen. Blanche Lincoln, D- Arkansas, who proposed the bill, some members of Congress were skeptical.

Grassley noted the Senate Agriculture Committee has been working on the bill for months and approved it by a vote of 13-8.

Grassley has represented Iowa since 1958, when he was elected to Iowa Legislature.

He recently announced a number of grants awarded to the UI, including around $50,000 to the UI Labor Center and $375,000 that the university will use to fund a lung-disease research project.

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