The Early Word: Regulatory Rounds

The Senate will hunker down at 2 p.m. today to reshape legislation designed to overhaul the financial regulatory system, a process that could take at least two weeks.

The changes, proposed by members on both sides of the aisle, may draw some Republican support for what had largely been a Democrat-backed bill. Expect to see amendments proposing to forbid the use of taxpayer money to prop up a company and to stop banks from becoming “too big to fail” in the first place. The Times’s Carl Hulse elaborates.

Democrats may have won a small victory in getting their bill to the floor, but the debate has moved into precarious territory for both parties, explains The Times’s John Harwood.

The main Republican argument that the legislation would not prevent future bailouts fell flat. Going forward, the conversation will revolve around issues with far greater consequences for Wall Street, but far less political appeal: The consumer protection agency; the Volcker rule, which would bar large institutions from certain “proprietary trading” activities; and Senator Blanche Lincoln’s plan to force banks to spin off profitable operations for buying and selling financial “derivatives.”

The debate has swung so far toward regulation that it threatens to outstrip the intentions of the legislation’s principal authors, and complicate the Obama administration’s ability to reel it back in.

Still, several prominent experts argue the bill would do little to avoid the next financial crisis, report The Times’s Binyamin Appelbaum and Sewell Chan.

They say legislation does not address key issues like the instability of capital markets that provide money for lenders or the futures of Fannie Mae and Freddie Mac. Others believe we still don’t understand the disaster well enough to craft legislation to prevent another one.

Politico’s Martin Kady has posted this list of obstacles facing Senator Christopher J. Dodd, Democrat of Connecticut, the chairman of the Banking Committee.

In light of the looming battle, Mr. Dodd canceled plans to attend a fund-raiser Monday for Senator Kirsten Gillibrand, Democrat of New York, with financial donors, Politico reports.

Nonproliferation Conference: The 189 signatories to the Nuclear Nonproliferation Treaty gather today in Washington for a monthlong conference aimed at strengthening the agreement and, in particular, pursuing an effort to persuade Iran to suspend its uranium enrichment program.

American officials hope to pre-empt a Mideast arms race by persuading oil-rich countries neighboring Iran to give up the right to make atomic fuel that could be turned into bombs if they are allowed to develop nuclear power.

American Nukes: The Pentagon today will release long-classified statistics about the total size of America’s nuclear arsenal, The Times’s David E. Sanger reports.

Immigration Debate: Many Republican Hispanics are reconsidering their party affiliation after Arizona’s Republican governor signed the country’s toughest illegal immigration legislation, The Wall Street Journal reports.

Health Beat: As many as 20 states will not run federally funded high-risk insurance pools set up by the new health care law for those who are too sick to qualify for insurance between now and 2014 when companies are required to cover them, The Los Angeles Times reported. The group, led largely by Republican officials, are afraid their states will end up sharing the operating costs.

Kaiser Health News summarizes responses around the country.

Daily President: Mr. Obama is back in Washington today after a busy weekend that included an emergency trip to the Gulf Coast, where crude oil continues to gush from an oil well leak 5,000 feet below the water’s surface.

At 4 p.m. today, Mr. Obama will deliver remarks at the Commander in Chief Trophy Presentation with the Naval Academy in the Rose Garden. Then, at 6:45 p.m., he will host a dinner for the Business Council in the State Dining Room.

Out West: California’s Republican gubernatorial candidates faced off in a debate Sunday night. The contest echoes other Republican primaries around the country, revolving around one argument: Which candidate — Meg Whitman, the front-runner and former chief executive of eBay, or Steve Poizner, the state insurance commissioner — is the true conservative.

Midterm News: In Pennsylvania, a slew of challenges to congressional incumbents across the state has made this year’s cycle exceptionally competitive, according to The Pittsburgh Post-Gazette.

Pelosi Profile: The Washington Post’s Paul Kane examines the role played by Speaker Nancy Pelosi at this point in the midterm election campaigns, when she’s vilified by Republicans and traveling to raise funds to maintain a Democratic majority.

Should Senator Ensign Resign? Senator Tom Harkin, Democrat of Iowa, thinks so, Politico reports.

Gates Speaks: Defense Secretary Robert M. Gates will discuss the challenges of paying for national defense during time of economic difficulties at 12:45 p.m. at the Gaylord National Resort and Convention Center in Maryland.

Iraqis Play Ball: The State Department is sponsoring a baseball camp for Iraqis. The department’s cultural affairs office has brought a group of young baseball players from Iraq to Washington for a weeklong baseball clinic.

Science Bowl: Today is the final day of the Department of Energy’s 20th annual Science Bowl, a competition between 105 regional high school and middle school championship teams from 42 states. The final round begins at 9:15 a.m. at the National Building Museum in Washington with Michelle Obama asking bonus questions at 11:15 a.m