WASHINGTON - In a politically charged speech Tuesday, Senate Banking Committee Chairman Phil Gramm urged bankers to put their money where their mouths are on issues important to them and the country.
"I want to urge you in these remaining days of this election to put up your time and your talent and your money to try to affect the outcome of this election based on what you believe is in the interest of America," the Texas Republican said in a speech here at the American Bankers Association's annual convention.
"It's going to make a very big difference to America whether George Bush is President of the United States or whether Al Gore is President of the United States," he said. "It's going to make a very big difference to America whether we have a Republican majority in the House and the Senate."
The fight over bankruptcy reform, he said, is a partisan litmus test.
Legislation on the issue has passed the House and Senate with bipartisan support, but President Clinton is threatening to veto it because, he has said, it does not provide adequate consumer protections.
Specifically, the White House has demanded broader protections from abusive check collection practices; a prohibition on abortion clinic attackers filing for bankruptcy to escape court penalties; and the elimination of state laws that let wealthy debtors escape creditors by buying expensive homes that may not be seized.
Sen. Gramm called the White House demands a "smokescreen to try to get some political cover for killing this bill." Both sides "say they want the bill, yet we don't have the bill," he told reporters after the speech. "That says one side is not telling the truth."
Asked if Republicans will alter the bill to meet White House demands, he said, "The bill is already a dramatic compromise. This is not the bankruptcy law I wanted. We already have numerous provisions in the bill that really try to transfer the blame for somebody going broke to somebody else. My view is they have already succeeded in what they set out to do."
Donald R. Mengedoth, who was officially named ABA president Tuesday, echoed the Senate Banking chairman.
"What we are realistically going to be able to accomplish is going to be influenced by the outcome of the election," Mr. Mengedoth, the chairman of Community First Bankshares of Fargo, N.D., told American Banker.
"For example, with bankruptcy if we have a Republican executive branch, we're likely to see bankruptcy [reform] get accomplished very quickly. On the flip side, if Democrats are in control of either of the houses of Congress or the executive branch, I think it is less likely that we will be successful."
Sen. Gramm said that election-year politics has also stirred rhetoric on predatory lending and privacy, and that bankers should not bow to the pressure to change their practices.
"Don't apologize when you make a loan above the prime rate to someone that has a marginal credit rating," he said. If Congress is not careful, "in the name of predatory lending, we could end up denying people with moderate income and limited credit ratings the opportunity to borrow money," he said.
Sen. Gramm also told bankers "to quit backing up" on "privacy.
"I want to urge banks to quit apologizing for wanting to provide services to your customers," he said. "If you make a customer a home loan, and you also sell homeowner's insurance, and if you think you can sell a better product at a better price, if you don't contact that customer, you're not serving the people who have honored you by doing business with you.
"Why in the world should you apologize for trying to provide quality services to your customers?"
