What Congress has in store for the Fed

WASHINGTON (CNNMoney.com) -- More than a year after the financial meltdown of 2008, Congress is moving forward on plans to drastically curtail the power of the Federal Reserve.

There is a debate about lawmakers' motivations, and many details must still be worked out between different proposals.

Currently, the main bills in the House and Senate differ in specifics, and the Senate would go further than the House in curbing Fed powers.

But both chambers are proposing fairly drastic changes.

• The House and Senate both propose creating a Consumer Financial Protection Agency that would strip the Federal Reserve of its consumer oversight powers.
• Both chambers would create a new check on the Fed's powers to step in and make emergency loans to nonbanks.
• The Senate proposes stripping the Fed of banking oversight and giving that power to a single regulator, leaving the Fed with mostly a monetary policy role.
• The Senate would also reshape how the 12 regional Fed boards are structured, giving Washington more say in who runs them.

Some argue that the changes are meant to be punitive and to rein in a Fed that critics say has too much power. Others say proposals would enact long-overdue changes to streamline financial regulation.

"We had too many cooks in the kitchen," said Alice Rivlin, a former Fed vice chairwoman and now a senior fellow at the the Brookings Institution. "Consolidating banking regulators would strengthen the Fed and allow it to pay attention to its main job, monetary policy."