It was only a few months ago that financial reform was on the top of everyone's to-do list. Now it seems the failing efforts at reforming the health care system has sapped all the energy out of reforming Wall Street.
Sweeping regulatory reform of the financial sector-thought to be a 2009 legislative given just four months ago-may now come down to a piece-meal approach, with the White House and its allies happy to see a couple prized components signed into law this year.
"I think it's unraveling,' says former FDIC Chairman William Isaac. "It is hard for me to see how this legislation gets done this year."
The diminished prospects are more than just a crowded legislative agenda with equally complicated-yet higher-profile-reform initiatives on health care and energy. The growing lack of urgency also seems to reflect both human nature and political reality.
The financial crisis of a year ago is now more like a distant memory than a call to action. And the financial reforms themselves may be more controversial and less open to compromise or consensus than originally thought by both the White House and Congressional leaders.
You can now see why the corporate media has pushed so hard the "Green Shoots" talk - if things aren't bad then there is no urgency.
"I know they know they way over-reached," says Corker, who along with Sen. Mark Warner (D-Va.) has introduced stand-alone legislation on resolution authority.
"The administration put up such a bad proposal, a difficult job has been made nearly impossible," says Isaac. "They didn't address the problems they needed to address and addressed a bunch of problems they didn't need to address that had nothing to do with the crisis. You make enemies out of people needlessly."
Some observers say that was the case almost from the start.
Or maybe it was by design.
The proposals also challenged the status quo of the financial services industry, which publicly supported the reforms in general but lobbied against many of the particulars behind closed doors.
"There's a lot of problems with this regulatory reform, so it could easily slip to next year," says one knowledgeable industry representative.
Here's an idea. How about we roll banking regulations back to 1979 and work from there?