Thank you, Goldman Sachs

Call it the Goldman effect. For whatever reason, it looks as if the Senate is holding firm, for the moment, on tough new regulations on Wall Street. The Street's lobbyists are no longer getting the traction they once did in congressional corridors paved with millions of lobbying dollars. While Senate banking committee chairman Chris Dodd had to throw out a provision mandating a $50 billion corporate-funded rainy-day fund that the ranking Republican, Richard Shelby, described as a "honey pot," other new restrictions remain as the overall financial-reform bill heads to a floor vote. Among them: a new rule inspired by the SEC charge that Goldman Sachs created a "synthetic CDO" designed to fail with secret advice from the short-selling maestro, John Paulson. The new rule gives the SEC and Commodity Futures Trade Commission discretion to ban swap transactions that look like mere gaming bets on whether deals—or countries—will fail, preserving the swap function for its proper use as a hedge against future price or rate changes. Other provisions appear to ensure that the vast majority of derivatives deals will be cleared and done on exchanges, and that major users of derivatives will be regulated.

Has Congress suddenly grown a collective spine? Between the SEC case, the recent hearings held by the Senate Permanent Subcommittee on Investigations, and the current turmoil in the euro zone (exacerbated, some say, by derivatives deals), even Republicans can read the writing on the wall now: the public wants action against Wall Street. Will there be—!—an actual bipartisan vote in favor of financial reform?