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As the House Financial Services Committee begins its final push today in drafting legislation that will overhaul the banking system, lobbyists are scrambling to get Members of Congress to address specific provisions that would harm their clients bottom lines.
The intense lobbying push comes after weeks of hearings and meetings with committee staffers to try to slow the process down and narrow the scope of the Obama administrations proposal, which would give the government significantly more power over financial institutions and would shift the cost of rescuing struggling banks from taxpayers to other large companies.
Republicans have been pushing the committees chairman, Barney Frank (D-Mass.), to delay the hearing, citing the need to take more time to review the draft bill that was released late last week. Ranking member Spencer Bachus (R-Ala.) sent a letter Friday on behalf of House Republicans urging Frank for more time.
Industry lobbyists have also been pushing Frank to reschedule.
Wed like to wait a week, said Scott Talbott of the Financial Services Roundtable. He noted that the second draft of the bill, which is hundreds of pages long, was released late last week.
Still, financial services lobbyists say its unlikely Frank will slow down the hearing schedule given the pressure the White House and Treasury Department are putting on him to move as quickly as possible.
Frank has almost always kept to the schedule he presented earlier this fall to tackle the multipronged legislative effort.
The deadline for amendments on a systemic risk proposal was set for Monday evening. Even so, lobbyists are continuing to press lawmakers to vote for changes that they argue will not shut certain financial institutions out of the marketplace.
In particular, companies that have industrial lending arms and credit card banks have been campaigning for changes to the systemic risk legislation, which is directed at troubled institutions that might pose risk to the entire financial system.
This is just the latest dust-up over regulating financial institutions that are owned by companies such as retailers and manufacturers.
Over the years, lobbyists and law firms have created an entire infrastructure to push the interests of the banks. And while the issue is a very small piece in the larger picture of financial reform, industry insiders say they expect companies to expend serious resources on the fight.
The Alliance for Consumer Credit, a coalition of companies that have these lending capabilities, is one such group active in the battle.
The group formed after the Obama administration released its white paper in June on financial regulatory reform. Eris Group has been hired to lobby on behalf of the coalition.
Companies argue that the new rules would require lending units to come under the Bank Holding Company Act, which would significantly restrict the amount of credit they can lend to customers.
Franks bill, which was written in coordination with the Treasury Department, has softened some of the initial language on industrial lending arms. The administration had wanted to abolish holding companies that were company-owned. The draft bill released last week now requires industrial loan corporations to be governed under new rules and also includes a provision that would bring the parent company under the purview of the Federal Reserve.