Four key lawmakers on the financial reform conference committee are seeking to create loopholes in the so-called Volcker Rule and the derivatives section of the bill, according to Talking Points Memo.

The four lawmakers are Reps. Luis Gutierrez, Greg Meeks, Dennis Moore and Mel Watt. They have received a combined $5.5 million from the finance, insurance and real estate sector (FIRE) over their careers. All but Gutierrez received over 20% of their total career campaign contributions from the finance, insurance and real estate sector making them heavily reliant on the industry to fund their campaigns. Gutierrez received 19% of his contributions from the finance sector.

Lawmaker	Party	FIRE Contributions	Total Career Contributions	Percent from FIRE
Gregory Meeks	D	$1,461,292.00	$4,350,723.00	33.59%
Mel Watt	D	$952,138.00	$4,204,301.00	22.65%
Dennis Moore	D	$2,339,991.00	$11,551,282.00	20.26%
Luis Gutierrez	D	$772,407.00	$3,990,337.00	19.36%

The loopholes that would be created are being suggested in a letter sent by the 68 members of the New Democrat Coalition, a group of moderate Democrats who have opposed many of the tougher regulations proposed for derivatives trading. TPM obtained a draft of the letter, which can be viewed here.

Meeks and Moore are both members of the New Democrat Coalition.  The Hill reported earlier this week that the New Democrats are drafting a letter urging the conference committee to drop a provision proposed by Sen. Blanche Lincoln requiring banks to spin off their derivatives trading desks into separate units.

During debate in the House over financial reform in 2009 the New Democrats played a key role in exempting a wide-swath of end-users from derivatives trading oversight and limiting the number of trades that will occur on an open clearinghouse.

Over their careers, the thirty-one congressmen appointed to the conference committee to hash out differences between the House and Senate versions of financial reform received a total of $43.5 million from the finance, insurance and real estate sector (FIRE), according to data obtained from the Center for Responsive Politics.

The conference committee will begin meeting today at 2:15 pm to hash out differences between the two chamber's bills written to reform the financial sector. (The Sunlight Foundation will be covering the conference committee here.) The conference committee is made up of twelve senators and thirty-one members of the House.

Many of the House members appointed to the conference committee are heavily reliant on contributions from the FIRE sector to fund their reelection campaigns. Twelve conferees have received over 20% of their total career contributions from the FIRE sector.

Topping this list is House Financial Services Committee Ranking Member Spencer Bachus, who has received 46% of his career contributions from the FIRE sector. Bachus is also the top recipient among House conferees of total contributions from the FIRE sector with $4.28 million over the course of his career.

Rep. Paul Kanjorksi, the chairman of the Subcommittee on Capital Markets, Insurance and Government-Sponsored Entities, is the second highest recipient of contributions from the FIRE sector and second-most reliant on those contributions among House conferees. Kanjorski has received $3.85 million from the FIRE sector over his career, accounting for 44% of his total career contributions.

The Chairman of the House Financial Services Committee and chief architect of the House version of the bill, Rep. Barney Frank, is also among the top recipients of FIRE contributions and most reliant on their funding. The $3.33 million in FIRE contributions to Frank's campaigns account for 33.6% of his total contributions received over his career.

Other members of the conference committee who received over 20% of their total contributions from the FIRE sector include Reps. Jeb Hensarling (34.6%), Gregory Meeks (33.6%), Judy Biggert (30.3%), Ed Royce (30.2%), Carolyn Maloney (29.63%), Nydia Velazquez (22.8%), Mel Watt (22.6%), Scott Garrett (21%) and Dennis Moore (20.2%).

Nine of the House members appointed to the conference committee received under 10% of their career contributions from the FIRE sector. Two of these lawmakers are chairmen of powerful committees. House Energy & Commerce Committee chairman Henry Waxman received only 5.6% of his career contributions from the FIRE sector and House Judiciary Committee chairman John Conyers received only 4.8% from the FIRE sector.

The others receiving under 10% include Reps. Howard Berman (9.9%), Sam Graves (9%), Darrell Issa (8.6%), Elijah Cummings (8.4%), Joe Barton (8.1%), Leonard Boswell (7.5%), Gary Peters (7.3%) and Mary Jo Kilroy (4.7%).

See below for a full table with FIRE contributions data. Calculations for total career contributions exclude candidate self-financing.

Lawmaker	Party	FIRE Contributions	Total Career Contributions	Percent from FIRE
Spencer Bachus	R	$4,287,174.00	$9,308,506.00	46.06%
Paul Kanjorski	D	$3,858,641.00	$8,631,857.00	44.70%
Jeb Hensarling	R	$2,569,025.00	$7,417,678.00	34.63%
Barney Frank	D	$3,332,260.00	$9,913,143.00	33.61%
Gregory Meeks	D	$1,461,292.00	$4,350,723.00	33.59%
Judy Biggert	R	$1,793,917.00	$5,911,226.00	30.35%
Ed Royce	R	$2,929,632.00	$9,700,216.00	30.20%
Carolyn Maloney	D	$3,097,927.00	$10,455,604.00	29.63%
Nydia Velazquez	D	$1,381,574.00	$6,058,922.00	22.80%
Mel Watt	D	$952,138.00	$4,204,301.00	22.65%
Scott Garrett	R	$1,445,423.00	$6,858,355.00	21.08%
Dennis Moore	D	$2,339,991.00	$11,551,282.00	20.26%
Frank Lucas	R	$986,154.00	$4,981,517.00	19.80%
Luis Gutierrez	D	$772,407.00	$3,990,337.00	19.36%
Shelley Moore Capito	R	$1,716,082.00	$10,514,333.00	16.32%
Lamar Smith	R	$1,264,198.00	$8,417,101.00	15.02%
Bobby Rush	D	$552,605.00	$3,749,676.00	14.74%
Edolphus Towns	D	$1,182,585.00	$9,140,618.00	12.94%
Collin Peterson	D	$668,664.00	$6,386,757.00	10.47%
Maxine Waters	D	$450,216.00	$4,338,793.00	10.38%
Heath Shuler	D	$423,334.00	$4,212,302.00	10.05%
Howard Berman	D	$959,091.00	$9,689,183.00	9.90%
Sam Graves	R	$760,628.00	$8,426,439.00	9.03%
Darrell Issa	R	$444,339.00	$5,166,114.00	8.60%
Elijah Cummings	D	$439,424.00	$5,208,334.00	8.44%
Joe Barton	R	$1,405,529.00	$17,185,272.00	8.18%
Leonard Boswell	D	$820,621.00	$10,851,998.00	7.56%
Gary Peters	D	$329,180.00	$4,512,451.00	7.29%
Henry Waxman	D	$348,525.00	$6,180,488.00	5.64%
John Conyers	D	$298,306.00	$6,119,757.00	4.87%
Mary Jo Kilroy	D	$325,277.00	$6,808,542.00	4.78%

Senators selected to work to combine the House and Senate financial regulation bills in a conference committee are some of the top recipients of campaign contributions from the finance, insurance and real estate sector (FIRE). In total, these twelve senators have received over $57 million from the FIRE sector over the course of their careers, according to data obtained from Center for Responsive Politics.

Senator	Career FIRE Contributions
Schumer, Charles E (D-NY)	$16,708,236.00
Dodd, Chris (D-CT)	$14,067,712.00
Shelby, Richard C (R-AL)	$5,635,030.00
Chambliss, Saxby (R-GA)	$3,507,960.00
Corker, Bob (R-TN)	$3,188,550.00
Johnson, Tim (D-SD)	$3,150,865.00
Reed, Jack (D-RI)	$2,918,732.00
Lincoln, Blanche (D-AR)	$2,612,159.00
Harkin, Tom (D-IA)	$2,534,445.00
Crapo, Mike (R-ID)	$1,809,715.00
Gregg, Judd (R-NH)	$1,070,249.00
Leahy, Patrick (D-VT)	$637,282.00

New York's Charles Schumer, D-N.Y., is the leading recipient among the Senate conferees with $16.7 million in contributions over his career. Schumer has long been an ally of the New York-based financial industry, but has been remarkably quiet as Congress has focused on reforming Wall Street. Schumer remains in support of the bill despite hometown pressure from industry friends, campaign contributors and Mayor Michael Bloomberg.

His support for the financial reform bill goes against a long history of supporting deregulatory actions for Wall Street. In the late 1990s and 2000 Schumer enthusiastically supported measures that ended the Glass-Steagall separation between commercial and investment banks and the enforced deregulation of derivatives trading.

The new rules for derivatives trading included in the Senate bill remain a serious sticking point in the coming conference committee. Senate Banking Committee chairman Chris Dodd, D-Conn., has already attempted once to eliminate a provision in the bill, penned by conference committee member Sen. Blanche Lincoln, D-Ark., ($2.61 million), requiring banks to spin off their derivatives trading portofolios. Dodd is the second largest recipient of FIRE campaiagn contributions on the conference committee with $14 million for his career.

Dodd is also connected to Wall Street with seven of his former staffers currently lobbying for financial organizations. Organizations represented by Dodd's former staffers include Goldman Sachs, Genworth Financial, MBIA, National Association of Mortgage Brokers and New York Bankers Association.

One former Dodd staffer turned financial industry lobbyist runs a financial lobbying firm with the former senior advisor to Dodd's Republican counterpart on the Banking Committee, Sen. Richard Shelby, R-Ala., the third highest recipient of contributions from the FIRE sector on the conference committee ($5.63 million).

Andrew Lowenthal and Lendell Porterfield run a bipartisan lobby shop providing clients with instant access to the Senate Banking Committee and, with both of their former bosses on the financial reform conference committee, the final chance to change the sweeping regulatory bill.

Recently joining Lowenthal and Porterfield as a partner in their firm is Dwight Fettig, a former Legislative Director to Sen. Tim Johnson, D-S.D., the sixth highest recipient of FIRE contributions appointed to the conference committee ($3.15 million). Johnson stands to become the next chairman of the Banking Committee after Dodd retires this year. The credit card industry, largely based in his state, has always counted on the support of the senior South Dakota senator.

Johnson, a career recipient of $391,400 in campaign contributions from the credit card industry, was one of ten Democrats to vote against an amendment to the financial reform bill capping “swipe fees” for debit card transactions. “Swipe fees” are charges to merchants for purchases made by customers using debit cards and often drive up retail prices for consumers. Credit card companies and banks are still lobbying hard to remove this provision from the bill. Johnson, however, is only one of four conference committees members to vote against the amendment making it unlikely the provision will be removed.

The conference committee will have to decide which portions of the House and Senate bills will be placed into a final version to be voted on and signed by the President. The House and Senate must pass bills with identical language. To do so, conference committees including members from both chambers meet to craft a compromise between the House and the Senate. The House has yet to name conferees.

The remaining members on the conference committee include Democrats Jack Reed, D-R.I., ($2.92 million), Tom Harkin, D-Iowa, ($2.53 million) and Patrick Leahy, D-Vt., ($637,282) and Republicans Saxby Chambliss, R-Ga., ($3.51 million), Bob Corker, R-Tenn., ($3.19 million), Mike Crapo, R-Wyo. ($1.81 million) and Judd Gregg, R-N.H., ($1.07 million).

A couple of days ago I wrote about some of the potential transparency issues related to the decision by House and Senate Democrats to skip conference for the health care reform bill (see here for background on what conference is). After thinking more and more about the issue I'm inclined to believe that the issues raised with skipping conference relates more directly to a structural shift in Congress that far too many are ready to ignore. (For more on the conference committee controversy see this post by John Wonderlich.)

Ezra Klein, who has been focusing on congressional malfunctions for the past few months, points out the major shift in congressional relations and partisan behavior in recent years:

...understanding the United States Congress as an institution gripped by ideological competition is simply wrong. It's an institution gripped by electoral competition. The political scientist Frances Lee puts this particularly clearly in her new book, “Beyond Ideology.”

"Parties," she writes, "are institutions with members who have common political interests in winning elections and wielding power, not just coalitions of individuals with similar ideological preferences." According to her data, senators in 2004 are 63 percent more divided along party lines than senators in 1981. It's no coincidence that the rise in party-line voting has coincided with the ideological realignment of the parties. Now that the parties agree internally, they can focus their efforts on winning power.

The dynamic that this electorally centered process creates is one in which the minority has no incentive to help the majority pass legislation. Rather than working to include conservative ideas in the health care bill there is total opposition from the Republican side. In this era, the key for the minority party, especially one that has suffered successive losses, is to kick the majority out and regain power. It's like a football team who throws in the towel in the middle of a losing season to acquire a high draft pick. Might as well aim to regain power in the future than play the game in the present. It worked for Republicans in 1994 and Democrats in 2006.

This new era (the past twenty-some-odd years) of Congress poses numerous problems for transparency in the legislative process. This largely stems from the fact that what has been viewed as the normal legislative process in the past no longer applies.

The majority rushes bills through Congress with little time for lawmakers or the public to review them. Omnibus bills obscure hidden provisions in the crammed, rushed appropriations process. Earmarks are used to fund the districts of endangered incumbents. Speeches on the floor and in committee hearings are akin to Javanese shadow puppetry so as to avoid the all-powerful gaffe patrol. The Rules Committee holds late night sessions – more so in the past than currently, but other problems still persist – prior to a bill's consideration leaving little time for lawmakers to review a bill's rule.

In many ways, there are moves to address some of these changes in legislative behavior. The passage of a rule requiring legislation be publicly available for at least 72 hours before consideration would reduce the ability of the majority to rush legislation. There have already been some reforms to the Rules Committee, while others continue this discussion. Earmarking is reduced and vastly more transparent. These are not fixes to get back to some “normal” legislative process that no longer exists, but ways to adapt to the way the legislature works in a partisan and electorally focused era.

There are countless debates circulating regarding how best to adapt to this new legislative era. Transparency advocates should be aware of the way Congress has changed and focus on adapting the transparency agenda to reflect this changing dynamic rather than seeking to return to a “normal” procedure that has long since become irrelevant.

Earlier today, Jonathan Cohn broke the news that House and Senate Democrats are "almost certainly" going to bypass the official conference committee process to pass the health care reform bill. The reasoning given by Democrats is that going to conference allows Republicans with multiple opportunities to block or delay the bill's ultimate passage. David Waldman gives a great run-down of the rules that would allow for further delay. The move to conference would require multiple Senate votes on moving to conference and appointing conferees, all processes that are subject to cloture votes (60 votes) and require 30 hours of debate. Skipping conference eliminates these cloture votes and requires lawmakers to only cast votes on the final passage of the bill. While providing the speedier passage of the bill, skipping conference presents some transparency-related problems.

Recently adopted and long standing House and Senate rules require conference committees to be generally open to the public. Both House and Senate rules require that all conference committee meetings be open to the public unless a majority of conferees votes in open session to close the meetings. Senate rules require all conference committee reports be publicly available for at least 48 hours prior to a final vote. Without conference, there is no mechanism to provide for openness in the final discussions regarding the health care bill.

Other conference rules provide for openness within the conference committee rather than public openness. These provisions require that conference committees not exclude conferees from decisions or refuse them the ability to see documents or participate in meetings. It will be much easier to exclude potentially difficult members (coming from both the left and right) without a formal conference.

The forgoing of formal conference isn't entirely uncommon -- and, in the end, everyone will still have to go on the record as for or against the final bill. At the same time, the process may speed up the bill's passage while potentially limiting both the public's and many of their elected official's ability to consider the changes to the bill. As with every other major moment of consideration during this bill's journey, both chambers should make the final version (conference report, amendment, substitute) available for at least 72 hours prior to consideration.