WASHINGTON (Reuters) - With the subprime mortgage crisis fanning recession fears, Washington is scrambling to jump-start the U.S. economy and ease the blow of falling home prices and rising foreclosures.

The Federal Reserve is slashing interest rates and Congress is moving fast to complete a fiscal stimulus package likely to include steps to prop up the mortgage market and help save many Americans from being thrown out of their homes.

Emergency policy options, as well as the outlook for long-term reforms to the banking system, will feature in discussions with 20 top lawmakers and regulators scheduled to appear at the Reuters Regulation Summit that runs February 5-8.

As the markets swing sharply on each new subprime development, members of Congress and senior supervisors for the banks and Wall Street will meet with Reuters journalists in Washington D.C.

Among lawmakers being interviewed are Democrats Carl Levin of Michigan and Charles Schumer of New York, and Republican Charles Grassley of Iowa, all from the Senate, which is working to complete a multi-billion-dollar stimulus package to send to the White House by mid-February.

The package may include a provision to allow the Federal Housing Administration and housing finance giants Fannie Mae and Freddie Mac to back larger loans and let distressed borrowers refinance into more affordable mortgages.

Skepticism about such a move has been expressed by James Lockhart, director of the Office of Federal Housing Enterprise Oversight, which regulates Fannie and Freddie. Lockhart is also scheduled to take part in the Reuters summit.

The subprime crisis, more than any other recent troubles in the business world, such as the Enron collapse or the stock analyst scandal, is revealing the street-level dangers posed by long-festering problems at the core of the financial system.

Predatory consumer lending, baffling complexity in securitized debt markets, inadequate government oversight, opaque balance sheets, and deceptive accounting -- all are issues confronting financial regulators with new urgency.

For instance, questions about the risks posed by financial woes at bond insurers, such as MBIA and Ambac Financial, will be put to key banking overseers at the summit, including Federal Deposit Insurance Corp Chairman Sheila Bair and the heads of the Office of Thrift Supervision and the Comptroller of the Currency.

The event will also feature Rep. John Dingell, a feared investigator and chairman of the House of Representatives Energy and Commerce Committee, a wide-ranging panel with jurisdiction over consumer protection.

Two officials from the Securities and Exchange Commission, including Commissioner Paul Atkins, will attend the summit as the SEC probes the subprime involvement of investment banks Morgan Stanley, Merrill Lynch, UBS AG, Bear Stearns and many other companies.

Also at the summit will be top accounting and auditing regulators, at a time when major financial houses are recording huge mortgage-related losses.

How could it be that the highly paid wizards of Wall Street, after years of promoting innovative new risk management methods, could have gotten the subprime market so wrong? What balance sheet shortcomings caused such widespread error?

Issues such as these -- as well as others unrelated to the subprime crisis, such as clinical drug trial fraud and patent law changes -- can be expected to dominate the summit.

(Reporting by Kevin Drawbaugh; Editing by Tim Dobbyn)

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