Insurers Outlobbied Bankers
WASHINGTON -- Minutes after the House voted down the omnibus banking bill Monday night, Rep. Thomas R. Carper saluted his principal antagonist, Paul Equale, the chief lobbyist for the Independent Insurance Agents of America.
"I told him, |If I didn't have a healthy respect for you before, I do now,'" recalled the Delaware Democrat, who battled long and hard against the insurance agents' effort to limit bank powers.
In the fierce lobbying battle over the bank bill on Capitol Hill, insurance agents routed the administration and banking interests whenever it came down to issues pitting one industry against another.
Faced with a strong push to give banks more authority to sell and underwrite insurance, the insurance lobby successfully watered down the proposal. Indeed, the resulting amendments would have ended up rolling back the limited insurance powers banks already have.
The agents may have been victims of their own success. One reason the bill was defeated Monday is the feeling among many lawmakers that the insurance industry had won too much.
One key to the insurance industry's success was its highly visible lobbying force.
"If you were a member of Congress and looked outside the chamber" from the House floor, said Mr. Equale, "you were probably more aware of the insurance industry than anybody else."
As many as nine insurance lobbyists stood outside the elevator bank used by members of Congress heading to the floor.
"The insurance guys are out in force," said Cory N. Strupp, who heads government relations for J.P. Morgan & Co.
Bankers Helped Kill the Bill
Banking organizations had their own professional lobbyists at work, but they were fewer in number and less visible. The American Bankers Association, for example, had no more than three lobbyists working the hallways during the vote.
Nevertheless, Edward L. Yingling, chief lobbyist for the ABA, said the industry mounted "a massive grass-roots effort."
The ABA had 97 bankers from 49 states on the Hill Monday visiting with their Congressmen, urging defeat of the measure.
Meanwhile, the Independent Bankers Association of America carpet-bombed the Hill with 435 plastic piggy banks emblazoned with its logo and that of its new ally, the American Association of Retired Persons, along with a simple message: maintain existing levels of deposit insurance and assure access to essential banking services for low-income persons.
Communicating Deep Concern
"It's not enough just to have a message," said Stephen L. Verdier, the trade group's House lobbyist. "You have to let them know it's an issue you really care about."
Phones were used heavily. Bankers attending a Bank Securities Association meeting in Chicago on Monday were urged to call their legislators and tell them to vote down the bill.
The Texas Bankers Association used a fax network that can contact 1,000 banks simultaneously, said Robert E. Harris, president of the association.
The ABA, IBAA, Consumer Bankers Association, and other state banking associations used similar tactics.