By GREG HITT And DAMIAN PALETTA
Senate Minority Leader Mitch McConnell (R., Ky.) said the logjam broke after Republicans were given “assurances” by Democrats that “changes will be made to end taxpayer bailouts and the dangerous notion that certain financial institutions are too big to fail.”
Connecticut Sen. Christopher Dodd, the Senate Banking Chairman, and Alabama Sen. Richard Shelby, the panel’s senior Republican, have been meeting for days, ultimately agreeing to jointly support new powers for the government to break up a failing financial company.
Mr. Dodd agreed Wednesday to drop the $50 billion fund designed to pay for the liquidation of a failed firm. That money would have been collected in advance from large financial firms. Republicans had criticized the fund, saying it amounted to a permanent bailout fund that would weaken market discipline.
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