No analysis of the SDRM proposal is complete without some inquiry as to why support from the official sector, while strong, was not sufficient to ensure its adoption. A closely related question is why the private sector remained so virulent in its opposition. Since an amendment of the IMF's Articles of Agreement requires the support of three-fifths of its members holding 85% of the voting power,245 the support of the United States-which currently holds 17.14% of the IMF's voting power-was a necessary condition. Initially, the signals were positive. In September 2001, then-Secretary of Treasury Paul O'Neill, in testimony to the Senate Banking Committee, stated, "We need an agreement on an international bankruptcy law, so that we can work with governments that, in effect, need to go through a Chapter 11 reorganization instead of socializing the cost of bad decisions."246 As time went by, however, it became increasingly clear that the United States was only willing to embrace the "contractual approach" and that further work on the design of the SDRM proposal should be dropped. The decision of the United States to turn away from the SDRM proposal may have been motivated by several related factors. First, early consideration of the SDRM proposal was based on the absence of progress in the more incremental contractual approach. Given the breakthrough that occurred with the introduction of collective action clauses in New York-law-governed bonds in early 2003, more radical reform may have appeared less necessary. Second, and more generally, as the shape of the statutory framework began to emerge, there may have been serious doubts within the U.S. government as to whether there was any realistic chance that it would gain congressional approval. No matter how streamlined the SDRM proposal became, its provisions would still interfere with the contractual claims of U.S. investors. Moreover, the jurisdiction of the DRF, although limited, would supersede that of the U.S. courts during the restructuring process. For European countries, which had grown rather accustomed to resolving economic and financial issues through the establishment of treaty obligations and supranational institutions, this type of reform was not particularly novel. For U.S. lawmakers, however, it would have represented a major step. The concerns of the U.S. government regarding the SDRM proposal's reception in Congress may also have been heightened by the fact that the SDRM would be created through an amendment of the IMF's Articles of Agreement. As a powerful and relatively controversial international financial institution, any amendments to the IMF's charter were bound to attract considerable scrutiny. Indeed, even if lawmakers supported the SDRM proposal, there may have been a concern that they would want to use the opportunity to press for other reforms to the IMF that may not have been supported by the administration. But another critical factor behind the U.S. position was most likely the steadfast opposition to the SDRM proposal by the major financial industry associations. Not only did such opposition make it much more difficult for the SDRM proposal to be approved in Congress, but there was clearly a reluctance within the U.S. government to forge ahead with such an important reform of the international financial system when a key stakeholder in that system-the private sector-was so resistant. Opposition to the SDRM proposal by financial industry associations was, of course, also an important reason why a number of emerging-market countries also opposed the SDRM proposal. The private sector consistently warned that the SDRM, if adopted, would adversely affect the volume and price of capital to these countries. The source of the private sector's concern with the SDRM proposal merits some analysis. The issue is complicated by the fact that it did not always speak with a single voice. European and Asian financial institutions were less openly hostile to the SDRM p
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