The fur has begun to fly in Congress in the latest controversy in that body where bipartisanship is as now as much in style as the pay telephone. The latest: Democratic and Senate Banking Committee Chairman Christopher Dodd has accused Senate Majority Leader Mitch McConnell of lying about Dodd’s financial reform bill:

The architect of sweeping legislation that would revamp financial regulation took the Senate floor on Wednesday to accuse the Senate Republican leader of lying about the bill and being in Wall Street’s back pocket.

Senate Banking Committee Chairman Christopher Dodd, D-Ct., delivered a blistering 20-minute speech that included the revelation of a political talking points memo from a Republican strategist that was virtually verbatim to the criticism voiced Tuesday by Senate Minority Leader Mitch McConnell, R-Ky.

McConnell had accused Dodd of drafting partisan legislation, even though the Banking Committee chairman has worked for roughly half a year with key Senate Republicans and incorporated many of their ideas into his bill. McConnell also said the bill continues controversial bank bailouts, but it doesn’t.

What could possibly explain McConnell’s behavior (aside from a little thing called “mid-term elections”)?

Dodd apparently has a “smoking gun” — a smoking gun similar to the one held up before health care reform (go here) became bitterly partisan with talk about how reforming health care was a government “takeover”:

“It’s a naked political strategy,” thundered a visibly upset Dodd. He held up a leaked memo attributed to GOP strategist Frank Luntz that advises Republican lawmakers to accuse Dodd and other Democrats of perpetuating bailouts for giant banks. The public disliked the bank bailouts, so framing the Democrats’ financial overhaul legislation as a “bailout” could win Republicans votes.

“Nothing could be further from the truth. The bill as drafted ends bailouts,” Dodd said, describing how regulators would get new powers to dissolve large financial institutions, even healthy ones if their size is deemed to threaten the broader financial system

NBC’s Ken Strickland reports:

On his bipartisan efforts over the past year Dodd said, “I cannot for the life of me understand how anyone could claim with a straight face that what I have tried to achieve with this bill is a partisan effort.” And on the question of whether the bill will lead to more government bailouts he said, “Nothing could be further from the truth.”

The chairman cited three areas to refute Republican claims that his bill will guarantee a perpetual taxpayer bailouts:
— the bill establishes a financial stability oversight council to monitor risk
— it eliminates the Fed’s ability to prop up institutions
— and it sets up a safe process for shutting down dangerous firms that fail without endangering the economy or taxpayers

Dodd said his patience is running out with his Republican colleagues, after trying for months to reach a bipartisan consensus. “It’s not even a slight exaggeration to say that we spend countless hours, phone calls, meetings, e-mails, discussions, day after day, week after week, month after month, to try to get closer and closer to a proposal here that our colleagues could support.”

Why is this significant? Because the way modern political operates is this way:

A partisan attack line is decided.

Certain words are used and repeated over and over again (such as “death panels”) even if when fact checked the facts reveal the words are not accurate.

The charges, slogans are still repeated over and over on sympathetic talk shows, on websites where some writers write to promote specific candidates or political parties and on cable shows. Again, the facts don’t really matter. They sort of get in the way of the mantra.

If the mantra is repeated long enough it becomes an enduring perception and the mainstream media begins asking questions about it often enough so that the mention of the “issue” and raising of the questions helps cement the phrase or mantra and its negative connotation or charge into the general consciousness.

But Dodd isn’t the only one blasting McConnell for his lack of accuracy. Ezra Klein:

When Sen. Mitch McConnell said that the Senate financial-regulation bill meant “endless taxpayer-funded bailouts for big Wall Street banks,” he was, knowingly or not, taking aim at a policy that had been jointly developed by Sens. Mark Warner (D-Va.) and Bob Corker (R-Tenn.). The two lawmakers began collaborating last spring, when they started holding joint briefings on the financial crisis. Eventually, Sen. Chris Dodd tasked them with handling the problem of what happens when too-big-to-fail firms, well, fail. He tasked them, in other words, with handling the problem of endless bailouts.

After months of meetings, the two finalized an agreement in February. That’s the “resolution authority” part of the bill, which begins in section 201. And in an interview in his office this morning, Warner was not too happy with McConnell’s characterization of their work. “It appears that the Republican leader either doesn’t understand or chooses not to understand the basic underlying premise of what this bill puts in place.”

“Resolution,” Warner continued, “will be so painful for any company. No rational management team would ever choose resolution. It means shareholders wiped out. Management wiped out. Your firm is going away. At least in bankruptcy, there was some chance that some of your equity would’ve been retained and you could come out in some form on the other side of the process. The resolution that Corker and I have tried to create means the death of the company. The institution is gone.”

And further down:

“And here’s the hypocrisy of the Republican leader’s comments,” continues Warner. “I can guarantee you that if there had not been some pre-funding, the critique would’ve been: ‘Look at these guys! They’ve left the taxpayers exposed! What’s going to keep the lights on for these few days? It’s going to be Treasury funds or Federal Reserve funds. The taxpayer will be exposed!’ ”

“If you haven’t spent time with these issues,” Warner sighed, “it’s easy to pop off with sound-bite solutions that don’t work.”

There’s more so go to the link and read it in its entirety.

And McConnell? His comments after leaving a White House meeting, the White House’ retort to his comments almost sounded like a rerun from the battle over health care reform:
S

enate GOP Leader Mitch McConnell (Ky.) exited a White House meeting on the issue Wednesday and charged that the White House had ordered Democratic senators to pull out of bipartisan talks on an issue on which Democrats believe they have the advantage.

“They wanted to jam us,” said McConnell, whose message to Obama was to allow negotiators back to the table.

“I naively thought we were heading in that direction until the strings were pulled on the Democratic leaders,” McConnell said.

White House Press Secretary Robert Gibbs quickly fired back, saying Obama had invited Republicans to join in reform efforts.
But Gibbs then warned Obama “would not accept bad policy in pursuit of bipartisanship,” and also suggested Republicans were looking for loopholes for large banks and other financial interests.

Obama has “made clear that bipartisanship should not be equated with an openness to lobbyist loopholes and special interest carve-outs, and that he would be unwilling to negotiate on some key issues,” Gibbs said.

Senate Majority Leader Harry Reid (D-Nev.) also fired a shot at McConnell, saying a lock-out of Republicans was “a figment of his imagination.”

Read my earlier post on 24/7 partisanship in the U.S. of A.