WASHINGTON — Paul Nash walks a difficult line.
As he provides lawmakers with continuing education about the Federal Deposit Insurance Corp., he finds it is hard at times not to be an advocate for an agency that has much to gain — or lose — during the financial reform debate.
But Nash, like other government relations experts for federal agencies, is forbidden by law from lobbying for the FDIC, and says he has to resist being a pitchman.
"I don't refer to myself as a lobbyist. I was one in the past," said Nash, the FDIC's chief congressional liaison. "It's just not what I do in this job."
Still, the former Verizon Wireless lobbyist — in the true sense of the word — and Senate Banking Committee staffer started his current job at the outset of the fight over regulation, in which the agencies are being redefined, competing for new authorities and, at the extremes, trying to survive.
"Right now all the agencies are a little bit in turmoil, and there is a tremendous reallocation of responsibilities that's ongoing," said Nash, who is 42.
Though the FDIC cannot press for certain powers, it can be a challenge for Nash not to want certain outcomes.
"On a personal level, you get invested in what you're doing," he said. "I'm not just going up there and saying things that I don't believe in."
For example, while the agency is officially neutral on whether it should resolve failed nonbanks, Nash finds fault with giving the power to another entity.
"I'm always looking for a good reason why it shouldn't be us, and I'm open to the possibility that there is one," he said. "I just haven't heard it yet."
A Washington native, Nash joined the FDIC about a year ago to fill a position created for him, just as the administration and Congress were gearing up for a massive regulatory reform effort aimed at preventing a repeat of the financial crisis.
He serves as the deputy to FDIC Chairman Sheila Bair for external affairs. The position puts him in charge of three different agency arms: legislative affairs, ombudsman and the office of diversity and economic opportunity. Among his roles has been to establish the FDIC's advisory committee on community banking issues.
Previously, the FDIC's head legislative liaison was a lower-level staff post. But Nash, much like other senior officials since Bair took over in 2006, reports directly to the chairman.
"In my role as deputy to the chairman, that's not necessarily a role that functions from chairman to chairman, so each new chairman or chairperson has the ability to choose his or her own deputy," Nash said. "I'm looking out for the chairman's interests" in the three areas under Nash's watch "and making sure that there's a seamless stream of information directly to her."
But Nash is also a resource for the agency's army of examiners and resolution specialists, who only hear the sound bites about the reform effort, as well as for lawmakers from districts with failed banks who want to understand the agency's processes.
"We have a lot of bank examiners who get up every day and look at the newspaper and there's some new legislative proposal or some proclamation from Congress that directly affects their livelihoods," he said.
With the congressional debate over reform often dominated by rhetoric, Nash said he can help agency officials understand the political circus.
On the other side of the coin, when Congress may be going down a path that causes the FDIC concern, Nash can step in and try to explain why a piece of legislation could be a mistake.
"We provide information and explain the natural consequences of ideas that folks have," he said. "So, 'If you want to go down this road, here is what the real-world impact will be as we see it, just so you understand and that's what you intend to do.' We don't want unintended consequences."
Nash acknowledges the process results in his arguing on the agency's behalf, but only to a certain degree. He said other agencies may feel more compelled to lobby if the reform effort could result in a more drastic result for them.
"In a sense that is my broader responsibility to my agency, but I'm also the translator," Nash said. "I take the concerns that we have and I try to translate them in a way that's useful and meaningful for Congress to consider as they pursue this new regulatory landscape. If I were at an agency that were in jeopardy, I think that's a very difficult line not to cross."
Still, the FDIC has come under fire during the reform debate. The original bill from Senate Banking Committee Chairman Chris Dodd would have stripped the FDIC of its bank supervisory responsibilities — an idea that Bair and the agency adamantly oppose. Since that time, however, the FDIC has appeared to be on the verge of gaining power. Dodd is said to be considering a revised bill that would give the FDIC supervisory power over all state banks, including state member banks currently under the Fed's purview.
Nash's advocacy role was more explicit at Verizon Wireless, he said, where he was a director of federal affairs for eight years, focusing on telecommunications issues in the Senate.
Nash first become involved in public policy when, after leaving private law practice, he joined the 1996 election campaign of now-Sen. Tim Johnson, D-S.D., the No. 2 Democrat on the Banking Committee and Dodd's likely successor as chairman next year. He stayed on as legislative staffer, advising Johnson on banking, health care and telecommunications.
Despite the efforts by policymakers debating a reform regime, Nash has his own doubts that a final bill can be hashed out. He worries that the pitfalls of health-care reform may be an omen for passing financial reform. "Soon we'll be into the election season. I don't think it's a foregone conclusion that we'll get legislation," Nash said. "I did work on the Gramm-Leach-Bliley legislation, and that took four or five Congresses to come to fruition."
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