Cramdown, credit cards, climate change keep lobbyists busy

House and Senate lawmakers are heading toward votes by the end of this week on legislation that would clamp down on two major segments of the financial industry that have long fought additional regulations.

Meanwhile, energy lobbyists are swarming in the House, where a panel is preparing to fill in the details of a cap-and-trade bill designed to cool a warming planet at a final markup sometime next week.

In the Senate, Democrats are headed toward a vote on Thursday at the earliest on a controversial bill that would empower bankruptcy judges to write down home mortgages.

The bill, known as “cramdown” in the financial industry, appears headed for defeat, though, as Republicans remain unified in opposition and a handful of centrist Democrats have raised questions.

Senate aides said discussions were ongoing about whether the measure would come up as an amendment to or as part of a broadly supported bill boosting the borrowing authority of the Federal Deposit Insurance Corporation (FDIC).

Senate Majority Whip Dick Durbin (D-Ill.) continues to negotiate with JPMorgan Chase & Co., Wells Fargo, Bank of America and the Credit Union National Association to strike a deal on the bill.

“I think we’re hopeful we’ll have a deal by Thursday,” said a Senate aide. The broader financial industry has long resisted cramdown, arguing that it would lead to higher rates and fees for borrowers.

The Financial Services Roundtable, American Bankers Association and U.S. Chamber of Commerce, among other trade associations, are drafting a letter in opposition. When a similar bill came up for a vote last April, it was tabled by a vote of 58-36, with 11 Democrats voting in favor.

Supporters of the bill say it is a necessary measure to force mortgage lenders and servicers to modify terms. President Obama has signaled his support for cramdown, but appeared to favor it as a last resort.

The House will vote on Thursday on a bill sponsored by Rep. Carolyn Maloney (D-N.Y.) that would attempt to rein in credit card practices that consumer advocates have long opposed.

Obama last week met with executives from the nation’s leading credit card companies and signaled a desire to impose new restrictions on the industry. Maloney’s effort is similar to a series of changes to credit card policies issued in December by the Federal Reserve.

The bill would put the Fed’s changes into law at a faster pace. Currently, the Fed’s rules would take effect in July 2010, which consumer advocates say is too far in the future. Maloney sponsored a similar bill in the last session of Congress that passed with broad bipartisan support on a vote of 312-112, with 82 Republicans in favor and only one Democrat opposed.

There was no companion legislation then in the Senate. Sen. Chris Dodd (D-Conn.) has a bill this year with additional regulations on the industry, but the bill faces tough prospects passing the full Senate.

Off Capitol Hill, the U.S. Supreme Court will hear a case on Tuesday that pits state financial regulators against the federal government. State regulators have sought power to investigate questions of racial discrimination in lending practices among national banks; the federal government has argued it is their responsibility. The appeal before the court was filed by New York state Attorney General Andrew Cuomo (D).

Floor debates on climate and other energy issues are still weeks away, but the committees of jurisdiction are continuing to slog their way through a host of issues that could determine the nation’s future energy mix.

Few issues on Capitol Hill are attracting more attention than the cap-and-trade bill introduced by House Energy and Commerce Committee Chairman Henry Waxman (D-Calif.) and Energy and Environment subcommittee Chairman Edward Markey (D-Mass.).

On Monday, Markey announced his panel would have a final markup next week, although a specific date had not been set. A discussion draft calls for carbon dioxide and other so-called “greenhouse gases” to be reduced by more than 80 percent over the next four decades. But important details, such as how many emissions allowances are distributed for free and how many utilities and other polluters will have to purchase, have yet to be settled.

Another big fight between environmental advocates and utility lobbyists is over the value of federal mandates to force electric power companies to produce more electricity from renewable energy sources, such as wind and solar sources, and to promote programs that help consumers conserve energy.

To environmental groups like the Union of Concerned Scientists (UCS), including a renewable electricity standard in a broader cap-and-trade climate bill will ensure that utilities do not just rely on non-emitting nuclear energy or natural gas, which produces less carbon dioxide than coal-fired power plants, to meet carbon dioxide emission reduction requirements.

Marchant Wentworth, a lobbyist at UCS, said the renewable energy standard will provide utilities more tools to meet emission reduction requirements, and thereby help to control the costs of a cap-and-trade bill.

Utility groups like the Edison Electric Institute (EEI) say the renewable electricity mandate adds an unnecessary level of government intervention that could actually complicate their efforts to meet new emissions standards.

“You have a lot of mandates stacked up on top of other mandates,” said EEI spokesman James Owen.

Steven Nadel, executive director of the American Council for an Energy-Efficient Economy, sees another big benefit to forcing utilities to offer programs that help consumers conserve electricity. An energy efficiency standard that is part of a discussion draft Markey and Waxman have introduced could save consumers $170 billion, he said.