Credit union executives showered Senate Banking Committee Chairman Phil Gramm with applause before he could even begin speaking at a conference here last week.

"Thank you very much," the Texas Republican told the annual legislative affairs caucus of the National Association of Federal Credit Unions. "Most politicians only get standing ovations at their hangings."

Over the last year, Sen. Gramm has stopped lawmakers and regulators from imposing requirements akin to the Community Reinvestment Act that governs banks on the nonprofit financial institutions. He reveled in successfully marshaling political and industry opposition against a proposal by National Credit Union Administration Chairman Norman E. D'Amours to make credit unions adopt formal community service plans.

The defeat last year of Senate legislation along the same lines washad been a political turning point in the battle against "unconstitutional" redistribution of the wealth of financial services firms to other parts of society, he said. "This process of stealing people's deposits and stealing people's wealth is coming to an end," Sen. Gramm said.

Mr. D'Amours received an icy reception at the NAFCU conference.

Only one NAFCU member, Frank Spencer of Teachers Federal Credit Union in Farmingville, N.Y., defended Mr. D'Amours. "Thank you, Frank," said the embattled NCUA chief, who without missing a beat turned to the crowd and added: "My brother Frank, everybody."


Federal Reserve Board Governor Laurence H. Meyer has seen the future, and he doesn't like it. In two recent appearances, Mr. Meyer warned against the trend in other countries, such as the United Kingdom and Australia, toward stripping regulatory authority from central banks.

"I wish our colleagues abroad good luck, but I think that their legislators have made a big mistake," he said.

If a central bank is to be held responsible for a nation's financial stability, he argued, it should not be removed from day-to-day oversight of the institutions on which that stability depends.

"Particularly in a crisis situation, a central bank without the knowledge of the way the markets actually operate -- the kind of knowledge that can only be gained by experience and hands-on contact with banking organizations -- such a ban, if you will excuse an old professor's metaphor, would be in danger of failing its final exam," he said.

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