Tomorrow, the House Financial Services committee is expected to pass the final facets of its regulatory reform effort, which would move a final package to the House floor for a vote as soon as mid-December. Not ready to go quietly into the night, the Financial Services Roundtable (FSR) — one of the main lobbying arms for the country’s biggest banks, including Citigroup, JP Morgan, and Bank of America — fired off a letter to committee members, pressing them to vote no on the bill.

In the letter, the FSR claims to be “a strong, and consistent, advocate for financial regulatory reform,” and emphasizes that reform “must happen sooner rather than later.” However, it then spends the bulk of the letter criticizing nearly every meaningful portion of the House legislation, claiming that it will destroy jobs and negatively impact the economy:

Several amendments designed to ensure financial stability will have negative consequences for the economy. The heightened capital standards for large financial institutions, combined with the cost of pre-funding a systemic risk reserve, will reduce lending and other activities by large financial companies. The provisions designed to prevent financial institutions from becoming “too-big-to-fail” will, at a minimum, increase the cost of funding for such companies, and may accelerate the failure of a troubled institution. The new powers for regulators to break up large firms create a disincentive for positive growth and job creation.

The only committee actions which the FSR voiced support for are a weakening of risk reduction provisions and a change to accounting standards so obviously advantageous to only big banks that even the Chamber of Commerce couldn’t support it. Remember, this is the same organization whose Senior Vice President for Government Affairs announced on C-Span that “we’re not for any regulation.”

Like other sectors, the financial services industry is counting on the jobs argument to resonate in an era of double digit unemployment. But the proposed measures are meant to safeguard the financial system against another crash, the last of which caused massive job loss to which we’re still struggling to respond. With its letter, the FSR is paying lip service to the obvious need for reform, while advocating permanently enshrining “too big to fail” and the sort of lax capital standards that led to some investment banks leveraging themselves at 40-1.

In terms of potential for job loss, it seems to me that the status quo is far more problematic, but you can bet that these same arguments will migrate with the bill over to the Senate.

While the health care debate takes center stage on the Senate floor, it’s worth remembering that the Student Aid and Fiscal Responsibility Act (SAFRA) of 2009 — which would overhaul the student loan industry — is still being fought over, as private loan companies try to preserve a system that senselessly gives them tens of billions of dollars in subsidies every year.

SAFRA passed the House of Representatives in September by a 253-171 vote, but the Senate has not yet drafted a concurrent bill. According to a new report from The Project On Student Debt, though, time is of the essence, as record high student debt is colliding with record high unemployment for recent college graduates:

Nationwide, average debt for graduating seniors with loans rose from $18,650 in 2004 to $23,200 in 2008, or about six percent per year…Meanwhile, employment prospects for young college graduates have soured along with the economy. The unemployment rate for college graduates aged 20-24 was a challenging 7.6% in the third quarter of 2008, the highest third quarter rate since 2002; by the third quarter of 2009 it had risen to 10.6%, the highest on record. The majority of the class of 2008 fell into this age group in both years.

In a move that wisely captures the political temperature at the moment, the private lenders are targeting specific senators — particularly Sens. Bob Casey (D-PA) and Jeff Bingaman (D-NM) — and framing their opposition in terms of jobs, claiming that SAFRA will eliminate thousands of positions at student loan companies if enacted.

While any job loss is, of course, lamentable, as Pedro de la Torre wrote, the lenders are “playing politics with jobs, frequently changing their job loss estimates, and exaggerating the impact that the legislation will have on their workforce.” “While reform will fundamentally change the student loan industry, it should not cause significant job losses,” he wrote, because the industry will still need to service loans.

And ensuring access to higher education isn’t about our current workforce, but our future one. As former President Bill Clinton told me, “higher education institutions are pricing themselves into America’s decline,” and “we are headed into long-term economic decline if we don’t do something about it.”

The Lumina Foundation estimates that, with the status quo, the American economy will face a shortage of 16 million college educated workers by 2025. In fact, “the United States may not only be losing ground compared to other countries, but also in relation to its own population,” as the projected 13 percent increase in college enrollment over the next ten years would occur simultaneously with a U.S. population increase of 14 percent.

So why would we cripple the next generation of workers, and simultaneously hasten our economic decline, to perpetuate business as usual for student loan companies?

When the Obama administration announced that the American Recovery and Reinvestment Act (i.e. the stimulus) had saved or created 640,000 jobs, Republicans quickly launched into a tirade. The Republican National Committee said that “it is clear the Obama administration is trying to cover up economic reality by manufacturing job numbers out of thin air,” while Rep. Darrell Issa (R-CA) wrote that “the American people have been subjected to an aggressive propaganda campaign” as “the administration has sent its spinmeisters out to trumpet an altogether dubious number of jobs ‘created or saved.’”

Well, last night, the Congressional Budget Office (CBO) released its latest estimates of the stimulus’ impact, and as it turns out, the 640,000 number was pretty spot-on:

CBO estimates that in the third quarter of calendar year 2009, an additional 600,000 to 1.6 million people were employed in the United States, and real (inflation-adjusted) gross domestic product (GDP) was 1.2 percent to 3.2 percent higher, than would have been the case in the absence of ARRA.

CBO noted that, to date, the stimulus has increased federal outlays by about $100 billion and reduced taxes by $90 billion, adding that “economic output and employment in the spring and summer of 2009 were lower than CBO had projected at the beginning of the year. But in CBO’s judgment, that outcome reflects greater-than-projected weakness in the underlying economy rather than lower-than-expected effects of ARRA.”

This obviously doesn’t mean that all is rosy in terms of employment. As the Wall Street Journal reported today, “the number of people involuntarily working part-time jobs has more than doubled to 9.3 million,” which is the highest on record. The average workweek “has fallen to 33 hours, the lowest level in the post-World War II period.” Meanwhile, the stimulus funds earmarked for small businesses have already run out, which “could set the stage for further business credit contractions.”

So with the knowledge that the stimulus is working as planned, in an economy that is weaker than forecast, will Congress find the stomach to step up on the jobs front? Or will deficit fearmongering leave it content to muddle through, leaving unemployment — and all of its detrimental economic effects — unacceptably high?