collin-petersonPresident Obama’s blueprint for overhauling regulation of the finance sector originally included a merger of the Securities and Exchange Commission and the Commodities Futures Trading Commission. But the proposal to merge the two regulatory agencies was mothballed after running into strong opposition on Capitol Hill.

Leading the opposition, according to a report today in Politico? Rep. Collin Peterson, chairman of the House Committee on Agriculture. Peterson tells the online publication that his resistance to the proposal was entirely principled, arguing that such a dramatic shake-up during a major recession would be wrongheaded.

“In the middle of a crisis, you shouldn’t shake everything up for no good reason,” he said.

But Politico also suggests that political contributions may have influenced Peterson and his allies in the House. Eliminating the commodities commission might have removed the incentive for individuals connected to the finance sector to give lavishly to agriculture committee members. Politico notes that political donations connected to finance, insurance and real estate totaled $8 million to such legislators in the 2008 election cycle.

Ultimately Obama yielded to political pragmatism and scuttled the proposal.