While the Bush administration focuses on plans to prevent housing crises in the future, Congress has decided that it is politically important to be seen taking action now.

Senate Republicans and Democrats have agreed to work together on a compromise on housing legislation and may have a bill today.

"The time has come for us to legislate, not continue our bickering," the Senate majority leader, Harry Reid, Democrat of Nevada, said at a joint appearance with the minority leader, Mitch McConnell, Republican of Nevada, the Los Angeles Times reports. The nonpartisan display was so rare that Reid had to tell reporters that it was not an April Fools' joke.

The new legislative push, the New York Times says, reflects “the mounting pressure on Congressional Republicans and the White House to extend a helping hand to average Americans after the Federal Reserve’s intervention in the near collapse and proposed sale of Bear Stearns.”

Reid said today that Democrats and Republicans in the Senate have reached an agreement in principle and that draft of the bill could be introduced by 5 p.m. today, Reuters reports.  "I think we're moving forward," he said.

Details of the compromise bill are still not known, but they are expected to include allowing state and local governments to issue $10 billion in tax-exempt bonds to refinance subprime mortgages and $200 million to expand counseling programs for homeowners.

There are also proposals in Congress to allow the Federal Housing Administration to insure $300 billion to $400 billion in additional mortgages. 

An earlier Democratic proposal to give bankruptcy-court judges the power to modify mortgages is not expected to be included.

Despite the apparent breakup of the legislative logjam, Martin Kady and Victoria McGrane on Politico.com caution that there “are still deep divisions in this Congress over tax cuts, the Bear Stearns bailout, and how far the federal government should intervene on behalf of homeowners facing foreclosure.”

“But Republicans and Democrats alike seem so scared of the political repercussions of doing nothing that they are willing for the moment to cede a few debating points and entertain the type of compromises that may anger their respective political bases.”

Yves Smith on NakedCapitalism.com is skeptical about the legislative effort: “What got us in this mess in the first place is that America has the most heavily subsidized housing market in the world. Is more of the same a wise solution?”