In the wee hours Friday morning, Congress finally agreed upon a final version of the massive financial services reform bill, the biggest rewrite of rules for the country's finance industry since the Great Depression. In the wake of the financial implosion two years ago, the legislation is meant to provide consumers with more protection from risky investing by banks.
You can find a quick summary of the major points of the legislation here. While the law includes tougher rules to benefit consumers many proposals -- such as Sen. Blanche Lincoln's (D-Ark.) proposal to regulate the derivatives market -- were weakened under pressure by the financial lobby.
And no wonder. Lawmakers negotiated this bill while sitting awash in campaign contributions from the financial sector -- historically the most generous giver of any industry to political campaigns. Some lawmakers were juggling their meeting schedules with political fundraisers at nearby restaurants. The Sunlight Foundation covered the negotiations live here, providing the contextual information about these kinds of connections, which typically are not included in day-to-day news reporting.
With the final bill now hammered out, however, that doesn't mean the lobbying by special interests has stopped. In some ways, it is just beginning.
As the New York Times reported, once Congress clears the compromise and President Barack Obama signs it into law, the new stage of action will be the federal agencies, which are charged with writing regulations to put the new law into action. These inside-the-beltway dealings are technically open to the public, but in practice are dominated by industry groups, which have the resources to follow the byzantine process.
Shaping regulations is a different game than shaping legislation. Political considerations carry less weight. Instead, regulators crave data that can be used to justify decisions....
Historically, industry groups have dominated these information wars, plying regulators with exhaustive studies and detailed analyses of the options at hand. Trade groups have more money and more people, and they often produce and control the relevant information about their business and customers.
At the Sunlight Foundation, we will be advocating that agencies make data public. Stay tuned.
Meanwhile, if you're up for some intensive reading, the final bill is available, in all its dizzying detail, for persual here. (Congress is making good on making the text of the bill available online for 72 hours before the final vote, as Sunlight advocates in its Public=Online campaign.)
consultant, Sunlight Foundation
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