– Christopher Swann is a Reuters columnist. The views expressed are his own —

The crusading spirit that at one stage threatened to lead to the nationalization of U.S. banks and the downfall of their top executives now seems like ancient history.

Banks are again flexing their muscles and have turned the tables on America’s politicians. Remarkably, policy makers now seem to be struggling to secure even a modicum of needed change in the regulatory system.

The winter’s paroxysm of public anger has dissipated with astonishing speed. This is in spite of the fact that economic recovery still seems a distant goal and the woes of CIT Group suggest that even the financial system is not out of the woods. As a result there is now a real danger that the administration and Congress will fail to live up to Rahm Emanuel’s famous injunction never to let a crisis go to waste.

The ability of the financial lobby to hold onto its political power has been one of the great mysteries of the crisis. Few special interest groups have shown such  flexibility in their logic.

As profits soared in the 1990s, their strength was taken as proof of their genius and politicians bowed to their every whim. After their crisis their weakness became a trump card. Hurt the banks, they argued, and the economy would go down with them. Now the banks are taking credit for a revival in profits that is almost entirely due to the extraordinary contortions of public policy.

The administration and Congress should not be taken in again. We are entering a crucial phase in the revamping of regulation and there is still little sign that the White House is putting enough political muscle into the process.

And as the self-confidence of the banks increases — along with TARP repayments and climbing profits — the window for reform narrows.

The industry is digging in its heels over efforts to create a credible consumer protection agency and to sanitize credit default swaps. These are debates the Obama administration cannot afford to lose. Keeping anything close to the status quo would expose the United States to a repeat of 2008.

Banks might have less money to throw around. But they do not appear to be skimping on lobbying. Political action committees run by the Independent Community Bankers of America have already raised 40 percent more funds than last year. Overall the finance, insurance and real estate sectors spent $110.7 billion on lobbying in the first three months of the year — second only to healthcare providers.

Financial lobbyists could be forgiven for a certain swagger of late. In May they managed to defeat President Obama’s push for a change in the bankruptcy law that would have allowed judges to cut the principal owed on home loans. They even capped this unlikely victory by extracting a concession that saved banks and credit unions at least $13 billion in fees to top up deposit insurance funds.

Now the industry would dearly like to abort Obama’s new Consumer Financial Protection Agency, which they believe would pay too little attention to the health of banks. Failing this, they want to defang the agency, limiting its powers to vet and approve products.

Given the prominent role played by poorly designed loan products in the financial crisis, this is a hard case to make. There is a pressing public interest in creating a vigilant gatekeeper for consumer products. Not only would it limit much individual misery, it should reduce the chances of bank collapses and public bailouts. It would not, as opponents have misleadingly suggested, seek to monopolize the design of financial products.

On credit default swaps the industry seems determined to stick as close to the status quo as possible, restricting any move towards transparency. If they get their way, the system will still be vulnerable to crises.

The determination of the financial lobby to obstruct moderate regulation on such key components of the recent crisis indicates an alarming lack of humility. Given their recent success, the industry may get much of what it wants.

This makes it especially important that the White House provide a stronger lead to Congress.

Obama appears to have been reluctant to spend his political capital. In fact a defeat of the powerful financial services lobby may actually help him get his way on the rest of his agenda. It would also leave America with a much safer financial system.