In an increasingly rare moment of congressional bipartisanship, the Senate on Thursday passed a bill aimed at easing regulations on small companies and startups.
Senators approved the Jumpstart Our Business Startups Act, or JOBS bill, by a vote of 73-26, easily overriding opposition from a few top Democrats, including Senate Majority Whip Richard Durbin of Illinois, who argued the bill goes too far in suspending regulations intended to protect investors and consumers.
Republican leaders in the House pledged to immediately take up the bill next week allowing President Obama, who supports it, to sign it into law quickly. The Senate bill is very similar to one the House approved earlier with overwhelming bipartisan support.
"I intend to schedule a vote on the Senate-amended Jobs Act early next week so we can get this bipartisan jobs bill to the president's desk," House Majority Leader Eric Cantor, R-Va., announced immediately after the Senate approved the bill.
With the national unemployment rate hovering at 8.3 percent, Durbin and other opponents never had much of a chance of defeating the bill. Lawmakers from both parties, especially those facing tough re-election bids this fall, are eager to demonstrate to voters that they are working to fix the struggling economy. The Jobs Act makes such a promise, though there are no firm projections of how many jobs the legislation might actually create.
Sen. Pat Toomey, R-Pa., called the Jobs Act "one of the most constructive things we are going to do this year in that area."
The Obama administration also claimed some credit for legislation, saying in a statement the bill includes "key ideas the president proposed last fall that will help our small businesses and startups access capital they need to grow and create jobs."
The bill aims to make it easier for small businesses to expand and add to their payrolls by exempting them from some of the rules and regulations that they must now comply with and which the bill's proponents say are stifling growth and job creation.
Small companies would find it easier to hold initial public offerings under the bill. They would be allowed to raise up to $50 million before Security Exchange Commission regulations and fees kick in. That's 10 times the current SEC threshold of $5 million.
The bill also allows small companies to forgo disclosure of their financial statements under SEC rules until they have 1,000 shareholders. That's an increase from the SEC's current threshold of 500 shareholders.
Toomey argued that initial public offerings have declined because the cost of pursuing capital in that way is prohibitively expensive and overly complicated for small and growing companies.
But opponents said the bill eliminates transparency and accountability measures written into law after the disastrous downfall of energy giant Enron, where accounting fraud resulted in widespread financial ruin for employees and investors.
Sen. Carl Levin, D-Mich., warned that the legislation carries major risks with little evidence it will help the economy.
"It will, however, take the cop off the beat relative to the activities of some huge banks and threaten grave damage to the honesty and integrity of our financial markets," Levin said.