In a fit of defiance that could limit his effectiveness as House Banking Committee chairman, Rep. Jim Leach broke ranks with Republican leaders Monday and opposed Newt Gingrich's reelection as speaker.

"For the country's sake, I have concluded that the most responsible course of action for the speaker is to step down and for the members to choose another leader for the House," Rep. Leach said in a three-page statement.

If his gambit fails and the investigation-plagued speaker prevails today, Rep. Leach could be stripped of his House Banking chairmanship. At the very least, experts said the Iowa Republican's ability to move banking legislation this year would be diminished.

"This completely emasculates Leach's ability to advance modernization legislation," a Republican Banking Committee staff member said. "It's doubtful he'll get anything to the floor."

"If Newt's reelected, I think this really hurts banking legislation," said an industry lobbyist. "It hurts (Rep. Leach's) ability to go to the leadership and ask that legislation be brought to the floor."

Financial services lobbyists refused to speak on the record about Rep. Leach's decision to oppose Speaker Gingrich, but all were astonished.

"I can't believe it," one lobbyist said. "This may be suicide."

"He's part of the leadership," said another. "You don't break and run on the speaker's election."

Independence has long been a Leach hallmark.

In 1973, at age 30, he resigned from the foreign service to protest President Nixon's firing of Watergate Special Prosecutor Archibald Cox. Since taking the helm of House Banking in 1994, Rep. Leach has often gone his own way, proposing changes to banking bills without consulting committee members.

One lobbyist noted that Rep. Leach has never been in the leadership's good graces: "He'll be a marked man, but what else is new?"

Other industry lobbyists said Rep. Gingrich, if he wins another term as House speaker, would let Rep. Leach keep his chairmanship to avoid looking vindictive.

In his statement to the press, Rep. Leach said, "The country is crying out for principle over partisanship, most notably for reform of a political system grown increasingly vulnerable to the corrosive influence of money. The charges the Ethics Committee has brought against the speaker go to the heart of our constitutional way of life."

Speaker Gingrich admitted Dec. 21 that he failed to ensure that the use of contributions to finance a college course he taught did not violate tax laws. He also admitted giving the Ethics Committee false information.

The Ethics Committee is scheduled to begin deliberating the speaker's punishment on Friday.

While not backing anyone in particular, Rep. Leach named 18 members who could take charge of the House, from Rep. Dick Armey of Texas to Rep. Connie Morella of Maryland.

The Banking Committee, Rep. Leach noted, has investigated the Whitewater scandal for two years, probing ethical questions about people in the Clinton administration.

"(A) critical way for the Republican Party to contrast itself with this administration is to set uncompromising ethical standards and insist on appropriate and timely accountability for its members," Rep. Leach said.

It was unclear Monday why Rep. Leach decided to oppose the speaker so publicly, but lobbyists speculated that he wants to bolster support in his district. Rep. Leach's 1996 election was relatively close, so he may be reminding his constituents that he is a moderate who stands up for what he believes. "He had a tough election and this might shore up his grass roots," one lobbyist said.

Bill McConnell contributed to this story.

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