The accounting industry, once a lobbying giant on Capitol Hill, seems to be in a defensive crouch. Embarrassed by Arthur Andersen's role in Enron's collapse, accounting's former allies in the House appear to be swiftly clamping down on the bean counters. On Apr. 16, the House Financial Services Committee approved a bill that would create a new oversight body to police CPAs and bar accounting firms from some lucrative consulting work for audit clients.

But don't expect a White House signing ceremony any time soon. House Republican and Senate Democratic leaders are poles apart on how best to curb auditing abuses. And they're far more interested in using accounting reform to score political points for the November elections than in reining in the green-eyeshade brigade. As a result, a crucial part of the post-Enron-reform drive could bite the dust.

House Republicans want to be able "to say they voted for something" to clean up corporate corruption, says one GOP adviser. But the Republican leadership's bill offers only modest curbs. Financial Services Committee Chairman Michael G. Oxley (R-Ohio) blocked Democratic proposals to prohibit accountants from providing any nonaudit services and to give the oversight board subpoena power. Republicans simply "are not in favor of reform," fumes Representative John J. LaFalce (D-N.Y.), the panel's ranking Democrat.

House Energy & Commerce Committee Chairman W.J. "Billy" Tauzin (R-La.) has hinted he wants stiffer curbs. But Tauzin lost jurisdiction over accounting to Oxley in a bitter struggle in 2000. So despite weeks of scoring headlines with his high-profile probe of Andersen's document-shedding, Tauzin has little leverage now.

That suits House GOP leaders just fine. They are leery of overregulating--and getting blamed by the voters if financial markets tank. They prefer to let the Securities & Exchange Commission keep accountants in line. "They want to rattle the legislative sword, but they don't want to take it out of the scabbard," says John Endean, president of the American Business Conference, which represents small and midsize companies. Republicans also are betting that Andersen's comeuppance and SEC Chairman Harvey L. Pitt's stepped-up enforcement will sate the public's appetite for change.

In the Senate, meanwhile, Democrats haven't come up with a consensus bill. The leading measure, co-sponsored by Senators Christopher J. Dodd (D-Conn.) and Jon S. Corzine (D-N.J.), is viewed as too extreme to win passage. Moderate Democrats are looking to Senate Banking Committee Chairman Paul S. Sarbanes (D-Md.) to fashion a compromise that could attract enough Republican votes to pass. But Sarbanes is taking his time, and Senate Majority Leader Tom Daschle (D-S.D.), who prefers a get-tough reform bill, isn't pushing him. "Daschle doesn't have his ducks in a row," says one business lobbyist.

To further complicate matters, Dems don't want Bush and the Republicans to steal their thunder. Given the President's 10-point reform plan and the SEC's crackdown on Xerox and other accounting miscreants, "if something were to come out of Congress, the credit would go to Republicans right around election time," says Grace Hinchman of Financial Executives International, a trade group. "It's just not in the Democrats' best interest [to compromise]."

That political calculus could change if Republicans succeed in portraying Daschle as a left-wing obstructionist. But for now, the reform drive is headed exactly where the CPAs would like it to go--off Capitol Hill and into the hands of the executive branch and the SEC. As the energy debate heats up on Capitol Hill, much of the focus has been on whether to drill for oil in Alaska's Arctic National Wildlife Refuge. Lost in the shuffle is the bill's bottom line: Business interests have done quite well in the congressional debate over energy policy. Once the bill clears the Senate, and differences with the House version are ironed out, corporate lobbyists are likely to be pleased with the version that lands on President Bush's desk.

While oil and gas drillers may not win on ANWR, they are going to be receiving $16 billion to $34 billion in new tax incentives. And the Senate bill provides $10 billion in loan guarantees for the construction of a natural gas pipeline from Alaska to the lower 48.

That's just the beginning. Midwestern farmers--including constituents in Senate Majority Leader Tom Daschle's home state of South Dakota--will benefit from the mandated phase-in of renewable fuel additives such as corn-based ethanol, which will be used to replace the suspected carcinogenic fuel additive methyl tertiary-butyl ether (MTBE). And the utility industry is getting its top legislative priority: repeal of the Public Utility Holding Company Act of 1935, which limits the outside investments of utilities. Perhaps the biggest winner is the auto industry, which managed to kill new federal fuel-efficiency mandates.

Because Democrats control the Senate, there are more environmental provisions than Bush included in his original energy blueprint. But K Street lobbyists still have plenty to celebrate.