Financial reform's sprint-like pace has slowed to a crawl in the hot Washington summer, but lobbyists say that they are not alarmed -- yet.
After the Senate approved financial reform this spring and the House followed suit before Independence Day, many supporters predicted a compromise bill would be ready for the President's signature before Congress took its August vacation. Instead, lawmakers became distracted by tax cuts and gun control and fought over the composition of a conference committee to reconcile the differing House and Senate measures.
When the committee finally held its first meeting on Aug. 3, members restated their differences over privacy, community reinvestment requirements, powers for bank subsidiaries, and other issues -- then left town. The void since has been filled by sdisagreements over how to word a summary of the two bills and by a procedural tiff between the House and Senate over how many signatures are needed on a compromise bill.
"It did not get off to as fast a start as people hoped," Edward L. Yingling, chief lobbyist for the American Bankers Association, said of the conference committee. "But that hope was probably unrealistic.
"I don't think people should be unduly concerned. The first few weeks have shown there are difficult hurdles ahead ... but there are so many people who want to get a bill done."
Indeed, Senate Majority Leader Trent Lott spoke optimistically in a meeting last week with ABA president R. Scott Jones, a group of Mississippi bankers, and others in Jackson, Miss. "He indicated strong support for finishing financial modernization this year," Mr. Yingling said.
Yet congressional staff members will be treading water until Congress returns next month. More than 50 of them met Tuesday for the second time in less than a week to review the draft summary of the differences between the House and Senate bills. Another meeting is scheduled Thursday, but observers predicted staff members will be able to accomplish little beyond technical clarifications until their bosses get back to make the hard decisions.
Still unresolved is a dispute between Senate Banking Committee Chairman Phil Gramm and House Banking Committee Chairman Jim Leach, who heads the conference committee.
Sen. Gramm has threatened not to participate in the conference because the House delegation has more Democrats (22) than Republicans (20). (The two delegations must separately approve a compromise before the House and Senate may vote on it.)
A House Banking spokesman called this a "nonissue" because, of the 42 House conferees, 15 are Democrats who are voting only on certain sections of the bill. The House will vote on its bill in sections, and Republicans will have a majority voting on each section. No vote is required on the overall bill by the conferees, he added.
Sen. Gramm has pointed to an Aug. 5 letter from the Senate parliamentarian saying that a majority of the 42 House conferees must sign the conference report before the Senate may consider it. Sen. Gramm wants the House to add some Republicans or subtract some Democrats, but the House is holding firm.