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Kai Ryssdal: Coming tomorrow to a financial crisis near you, the latest congressional offering for how to regulate the country’s banking system. Connecticut Senator Christopher Dodd, the chairman of the House Banking Committee, is set to release his plan for how to do that. There’s already a set of reform proposals moving through the House. Dodd’s version would differ in a couple of ways. He wants to consolidate all federal bank regulators into one agency. And he’d strip the Federal Reserve of its powers as a bank supervisor. Marketplace’s Steve Henn reports Dodd’s ideas are gaining steam with former bank regulators and some economic big-wigs in the Democratic party.

STEVE HENN: Alice Rivlin served as the vice chairman of the Federal Reserve during the Clinton administration, but if you ask her about the Fed’s record she doesn’t mince words.

ALICE RIVLIN: The Fed has not had a very strong record as a regulator.

Congress gave the Fed the authority to regulate mortgages. And many say that for 14 years ago, the Fed did nothing. And that’s not all….

RIVLIN: The experience with bank-holding companies, which the Fed did regulate, is not so encouraging that you would want to give them more responsibility.

CitiGroup’s near collapse, maybe the Fed should have caught that.

Eugene Ludwig was a top bank regulator in the 90’s. He says federal financial regulation right now is so fragmented that investigators who find problems can’t always chase them down.

EUGENE LUDWIG: You want the cop on the beat to be able to go over the county line, if you will, to inspect where the problem is.

But with one regulator covering a bank and another watching the parent company, that cop is often left at the county line with sirens flashing. And banks are also free to shop around and pick federal regulators they like. So Ludwig, and Rivlin would like to see one regulator with sweeping jurisdiction. Senator Dodd’s bill is likely to do that. But Ludwig says the administration’s current proposal and the bill in the House don’t go nearly far enough.

LUDWIG: To solve a near catastrophe for our financial system by doing the same old same old it seems to me is very dangerous indeed.

But Dodd’s bill is likely to face stiff opposition in the Senate. Bankers, it turns out, are pretty comfortable with the status quo.

In Washington, I’m Steve Henn for Marketplace.