Oversight of securities and insurance would be moved to the House Banking Committee under a restructuring of the House committee system that is receiving serious consideration by Republicans poised to take control of the Congress in 1995.
Another dramatic move being considered by Republicans in the euphoria of their sweeping victory in Nov. 8s election is the elimination of the consumer affairs subcommittee of the House Banking Committee. A subplot to this would be reducing the number of subcommittees in House Banking to four, with housing being shifted to an umbrella panel to be called the empowerment subcommittee.
Shifting oversight of securities and insurance from the Energy and Commerce Committee to the Banking Committee would be a boom to the banking industry. It is seen as helping shield the Retirement CD product from efforts by the insurance industry to bar banks from issuing annuities with deposit insurance. And under this scenario, the Glass- Steagall Act could also be history, according to banking industry and congressional staff sources.
The reasons the moves are being considered is the usual recipe for congressional action: Substance and pettiness. Substantively, the Republicans are same recipe. Rep. Michael Castle, R-Del., former governor of that state, would head the consumer subcommittee under the present scenario.
However, the consumer panel has been a gathering point for consumer activists, and the GOP feels they would gain many points from bankers if it was combined with another subcommittee. Combining the consumer subcommittee with another banking panel could be considered closing the barn door after all the animals departed, but it has been a hotbed for legislation hated by the financial services industry.
These include provisions in legislation imposing more paperwork and potential legal liability for servicers of asset-backed securities and originators of these instruments as well.
The petty side of this equation is that Republicans, where possible, want to eliminate any potential that Rep. Joseph P. Kennedy II, D-Mass., current head of that panel, would have a forum outside of publicity opportunities he creates for himself outside of Congress.
The possibility that the housing panel would be eliminated follows the same pattern. The Republicans want to create a forum to develop help for lower-income people, but at the same time, they want to reduce the publicity opportunities for current panel Chairman Henry B. Gonzalez, D- Texas, whose first love in Congress is housing aide.
Reducing the number of subcommittees would also reduce the need to find a post for Rep. Marge Roukema, R-N.J., one of the few middle- of-the-roaders left in Congress and an avowed enemy of Rep. Newt Gingrich, R-Ga., the incoming Speaker of the House.