The problem is Glass-Steagall, a Depression-era law that bars U.S. banks from uniting with brokerages and vice versa. In Congress the quid pro quo for knocking it down is expanding the mandated banking welfare program known as the Community Reinvestment Act, which mandates low-interest loans in high-risk inner cities. The banks are willing to go along -- "they know that they won't get deregulation without a compromise," says TIME senior economics reporter Bernard Baumohl -- but Gramm isn't.
Compromise -- to put it euphemistically -- was Al D'Amato's middle name. "But Gramm is much more of an ideologue," says Baumohl. "He's not willing to trade." Gramm single-handedly killed the previous deregulation effort last October, and now it looks like he'll be in charge come January. Sometimes integrity can be a real inconvenience.