How stealth banking bailout reached Obama’s desk

Both the left and right sides of the blogosphere are buzzing about a bipartisan TARP-style banking bailout bill that somehow reached President Obama’s desk in the legislative rush before Congress adjourned for the midterm election break.

The sordid episode underscores everything I’ve spotlighted about the culture of corruption over the last two years — sabotage of the deliberative process, circumventing of rules, backroom deals, and contempt for the will of the people.

Yes, the Vampire Congress strikes again.

The bill is HR3808, the “Interstate Recognition of Notarizations Act of 2010,” which requires courts to accept as valid notarized letters made out of state, making it harder to challenge the authenticity of foreclosure and other legal documents. Here’s the legislative history of the bill.

Reuters lays out the basic story:

A bill that homeowners advocates warn will make it more difficult to challenge improper foreclosure attempts by big mortgage processors is awaiting President Barack Obama’s signature after it quietly zoomed through the Senate last week.

The bill, passed without public debate in a way that even surprised its main sponsor, Republican Representative Robert Aderholt, requires courts to accept as valid document notarizations made out of state, making it harder to challenge the authenticity of foreclosure and other legal documents.

The timing raised eyebrows, coming during a rising furor over improper affidavits and other filings in foreclosure actions by large mortgage processors such as GMAC, JPMorgan and Bank of America…The legislation could protect bank and mortgage processors from liability for false or improperly prepared documents.

And now, the dirty details of the legislative legerdemain that paved the bill’s path to Obama’s desk:

After languishing for months in the Senate Judiciary Committee, the bill passed the Senate with lightning speed and with hardly any public awareness of the bill’s existence on September 27, the day before the Senate recessed for midterm election campaign.

The bill’s approval involved invocation of a special procedure. Democratic Senator Robert Casey, shepherding last-minute legislation on behalf of the Senate leadership, had the bill taken away from the Senate Judiciary committee, which hadn’t acted on it.

The full Senate then immediately passed the bill without debate, by unanimous consent.

No debates.

No amendments.

No roll call votes.

More:

The House had passed the bill in April. The House actually had passed identical bills twice before, but both times they died when the Senate Judiciary Committee failed to act.

Some House and Senate staffers said the Senate committee had let the bills languish because of concerns that they would interfere with individual state’s rights to regulate notarizations.

Senate staffers familiar with the judiciary committee’s actions said the latest one passed by the House seemed destined for the same fate. But shortly before the Senate’s recess, Judiciary Committee Chairman Patrick Leahy pressed to have the bill rushed through the special procedure, after Leahy “constituents” called him and pressed for passage.

The staffers said they didn’t know who these constituents were or if anyone representing the mortgage industry or other interests had pressed for the bill to go through.

These staffers said that, in an unusual display of bipartisanship, Senator Jeff Sessions, the committee’s senior Republican, also helped to engineer the Senate’s unanimous consent for the bill.

Neither Leahy’s nor Session’s offices responded to requests for comment Wednesday.

Zero Hedge calls it TARP 2. Others aren’t so sure of the bill’s impact. But anger over the corrupted process crosses party lines. Even the GOP House sponsor who initially proposed it to address a court reporter’s concerns was stunned by the speed with which it was shepherded through late last month after years of failed passage.

This stinks.

Will President Obama — Mr. Transparency — sign it? Ask him.

Fun fact via Steve Egg: One of the bill’s co-sponsors was none other than big banking buddy…GOP Rep. Mike Castle.

Wisconsinite Steve also notes from the legislative history: “The ‘debate’ in the House consisted solely of three people, one of which was Wisconsin’s own embarrassment Tammy Baldwin (of Madison), urging passage, which was done by voice vote.”

Update: The White House has “concerns.”

Uh-huh. Sure, they do…now.

Update: Obama will use his first veto and send the bill back to the House.

Update: Sent back, but not dead:

The authors of this bill no doubt had the best intentions in mind when trying to remove impediments to interstate commerce. We will work with them and other leaders in Congress to explore the best ways to achieve this goal going forward.