With millions of Americans unemployed, the nation struggling to recover from the greatest financial crisis in decades, and “job creation and economic growth” top priorities for the public, President Obama is poised to sign landmark financial regulatory reform meant to ensure the country won’t ever face these same dire problems in the future. MSNBC points to the legislation as a “reminder about how much the White House and the Democratic-controlled Congress have done in the past year and a half. … You can’t say this is a Do-Nothing Congress.” As the Center for American Progress’ Pat Garofalo explains, “There were many reasons for the economic collapse of 2008…but chief among them was a financial system that worked in the interests of Wall Street and too-big-to-fail financial institutions, and against the interests of consumers.” While not perfect, the Dodd-Frank Wall Street Reform and Consumer Protection Act would work to improve disclosure, protect consumers, reform the derivatives market, and regulate the riskiest practices of the nation’s biggest banks. Now that final passage is near, however, many Republicans — spouting rhetoric about wanting reform but unwilling to help pass anything that Obama has made a priority — are getting cold feet about voting against the interests of Wall Street.
LOOKING OUT FOR WALL STREET: On Friday, the conference committee reconciling the House and Senate versions of financial regulatory reform legislation approved final language (along a party-line vote) after a marathon 20-hour negotiating session. Lawmakers made a flurry of changes, including the addition of an exemption to the Volcker rule — a ban on banks trading for their own benefit with federally insured dollars — added at the behest of Sen. Scott Brown (R-MA), and a weakening of Sen. Blanche Lincoln’s (D-AR) provision requiring banks to spin-off their derivatives trading desks. However, the final bill retained Lincoln’s language requiring exchanges and clearinghouses for derivatives, as well as a provision that compels banks to hold more capital against losses. Unfortunately, Republicans decided they were not yet done making changes. Yesterday, negotiators had to briefly reopen conference proceedings “after Senate Republicans who had supported an earlier version of the measure threatened to block final approval unless Democrats removed a proposed tax on big banks and hedge funds.” Maine GOP Sens. Susan Collins and Olympia Snowe had announced that they would be joining Brown — whose campaign received heavy support from Wall Street — in voting against the reform bill because it imposes a $19 billion fee on the biggest financial firms to cover the cost of the law’s implementation. But as Mother Jones’ Kevin Drum noted, the bank fee is “not there to punish banks or to create a slush fund for new spending. It’s there solely to make the bill deficit neutral.” Rep. Barney Frank (D-MA) challenged the Republican hold-outs to find some other way to pay for the bill. “Do they want to add to the deficit?” he asked, calling these peacocks out on their deficit hypocrisy. “Is there another way? What’s their other way?” To appease these Republicans, the conference committee yesterday agreed to eliminate the bank tax and “bring an early end to the Troubled Asset Relief Program,” which would free up about $11 billion to pay for the bill. Every single Republican on the committee voted against this measure, instead opting to add to the deficit and put taxpayers on the hook for the legislation.
COMPARING THE FINANCIAL CRISIS TO A POOR LITTLE ‘ANT’: Brown, Collins, and Snowe haven’t been Wall Street’s only defenders on Capitol Hill in recent days. Perhaps the industry’s greatest ally has been House Minority Leader John Boehner (R-OH). In a recent interview with the Pittsburgh Tribune-Review, Boehner blasted Democrats for everything from health care reform and the BP oil spill response to financial reform. “They’re snuffing out the America that I grew up in,” Boehner said, adding, “There’s a political rebellion brewing, and I don’t think we’ve seen anything like it since 1776.” Taking up the GOP agenda of defending big business at all costs, he even compared the financial crisis to a poor little “ant.” Speaking of the financial reform bill, he said, “This is killing an ant with a nuclear weapon.” “An ant, Mr. Boehner? It was the worst financial crisis since the Great Depression — Americans lost 8 million jobs and $17 trillion in retirement savings and net worth,” responded a staffer to House Speaker Nancy Pelosi (D-CA). “The irresponsible fiscal policies of George W. Bush and Congressional Republicans were much bigger than an ant to American workers, their families and small businesses.” White House Press Secretary Robert Gibbs called Boehner “completely out of touch with America.” The Progress Report caught up with Sen. Richard Shelby (R-AL) and asked him about Boehner’s comments. He said that he “basically agree[d]” with his GOP colleague.
BLOCKING UNEMPLOYMENT BENEFITS: Senate Democrats tried and failed on three separate occasions this month to pass a tax extenders bill that included an extension of expired unemployment benefits. Republicans, along with Sen. Ben Nelson (D-NE), killed it by threatening a filibuster, potentially forcing states to cut 200,000 jobs, putting in jeopardy health and education programs, and denying benefits to 1.2 million out-of-work Americans. As a result, as Garofalo notes, Senate Democrats whittled the bill down to appease the GOP and “subjected more and more of the bill to spending offsets, ultimately leaving just the jobless benefits extension unpaid for.” While Republicans still refused to budge, Sen. Olympia Snowe (R-ME) — who joined the filibuster threat all three times — is now advocating for a benefits-only bill, even if it adds to the deficit. “Of course, passing a stand-alone bill neglects all the other important provisions that were in the extenders bill, including COBRA subsidies to help laid-off workers purchase health insurance and aid to states to help them with their Medicaid bills,” adds Garofalo. “Failing to pass such measures is only going to add to the economic misery that Snowe at least seems aware is occurring.” There are currently 15 million Americans unemployed, and almost half of them have been out of work for at least six months — a post-World War II record. The House plans to vote on extending unemployment benefits again today, after an attempt to do so was blocked by 139 Republicans and 16 Democrats yesterday.
With millions of Americans unemployed, the nation struggling to recover from the greatest financial crisis in decades, and “job creation and economic growth” top priorities for the public, President Obama is poised to sign landmark financial regulatory reform meant to ensure the country won’t ever face these same dire problems in the future. MSNBC points to the legislation as a “reminder about how much the White House and the Democratic-controlled Congress have done in the past year and a half. … You can’t say this is a Do-Nothing Congress.” As the Center for American Progress’ Pat Garofalo explains, “There were many reasons for the economic collapse of 2008…but chief among them was a financial system that worked in the interests of Wall Street and too-big-to-fail financial institutions, and against the interests of consumers.” While not perfect, the Dodd-Frank Wall Street Reform and Consumer Protection Act would work to improve disclosure, protect consumers, reform the derivatives market, and regulate the riskiest practices of the nation’s biggest banks. Now that final passage is near, however, many Republicans — spouting rhetoric about wanting reform but unwilling to help pass anything that Obama has made a priority — are getting cold feet about voting against the interests of Wall Street.
LOOKING OUT FOR WALL STREET: On Friday, the conference committee reconciling the House and Senate versions of financial regulatory reform legislation approved final language (along a party-line vote) after a marathon 20-hour negotiating session. Lawmakers made a flurry of changes, including the addition of an exemption to the Volcker rule — a ban on banks trading for their own benefit with federally insured dollars — added at the behest of Sen. Scott Brown (R-MA), and a weakening of Sen. Blanche Lincoln’s (D-AR) provision requiring banks to spin-off their derivatives trading desks. However, the final bill retained Lincoln’s language requiring exchanges and clearinghouses for derivatives, as well as a provision that compels banks to hold more capital against losses. Unfortunately, Republicans decided they were not yet done making changes. Yesterday, negotiators had to briefly reopen conference proceedings “after Senate Republicans who had supported an earlier version of the measure threatened to block final approval unless Democrats removed a proposed tax on big banks and hedge funds.” Maine GOP Sens. Susan Collins and Olympia Snowe had announced that they would be joining Brown — whose campaign received heavy support from Wall Street — in voting against the reform bill because it imposes a $19 billion fee on the biggest financial firms to cover the cost of the law’s implementation. But as Mother Jones’ Kevin Drum noted, the bank fee is “not there to punish banks or to create a slush fund for new spending. It’s there solely to make the bill deficit neutral.” Rep. Barney Frank (D-MA) challenged the Republican hold-outs to find some other way to pay for the bill. “Do they want to add to the deficit?” he asked, calling these peacocks out on their deficit hypocrisy. “Is there another way? What’s their other way?” To appease these Republicans, the conference committee yesterday agreed to eliminate the bank tax and “bring an early end to the Troubled Asset Relief Program,” which would free up about $11 billion to pay for the bill. Every single Republican on the committee voted against this measure, instead opting to add to the deficit and put taxpayers on the hook for the legislation.
COMPARING THE FINANCIAL CRISIS TO A POOR LITTLE ‘ANT’: Brown, Collins, and Snowe haven’t been Wall Street’s only defenders on Capitol Hill in recent days. Perhaps the industry’s greatest ally has been House Minority Leader John Boehner (R-OH). In a recent interview with the Pittsburgh Tribune-Review, Boehner blasted Democrats for everything from health care reform and the BP oil spill response to financial reform. “They’re snuffing out the America that I grew up in,” Boehner said, adding, “There’s a political rebellion brewing, and I don’t think we’ve seen anything like it since 1776.” Taking up the GOP agenda of defending big business at all costs, he even compared the financial crisis to a poor little “ant.” Speaking of the financial reform bill, he said, “This is killing an ant with a nuclear weapon.” “An ant, Mr. Boehner? It was the worst financial crisis since the Great Depression — Americans lost 8 million jobs and $17 trillion in retirement savings and net worth,” responded a staffer to House Speaker Nancy Pelosi (D-CA). “The irresponsible fiscal policies of George W. Bush and Congressional Republicans were much bigger than an ant to American workers, their families and small businesses.” White House Press Secretary Robert Gibbs called Boehner “completely out of touch with America.” The Progress Report caught up with Sen. Richard Shelby (R-AL) and asked him about Boehner’s comments. He said that he “basically agree[d]” with his GOP colleague.
BLOCKING UNEMPLOYMENT BENEFITS: Senate Democrats tried and failed on three separate occasions this month to pass a tax extenders bill that included an extension of expired unemployment benefits. Republicans, along with Sen. Ben Nelson (D-NE), killed it by threatening a filibuster, potentially forcing states to cut 200,000 jobs, putting in jeopardy health and education programs, and denying benefits to 1.2 million out-of-work Americans. As a result, as Garofalo notes, Senate Democrats whittled the bill down to appease the GOP and “subjected more and more of the bill to spending offsets, ultimately leaving just the jobless benefits extension unpaid for.” While Republicans still refused to budge, Sen. Olympia Snowe (R-ME) — who joined the filibuster threat all three times — is now advocating for a benefits-only bill, even if it adds to the deficit. “Of course, passing a stand-alone bill neglects all the other important provisions that were in the extenders bill, including COBRA subsidies to help laid-off workers purchase health insurance and aid to states to help them with their Medicaid bills,” adds Garofalo. “Failing to pass such measures is only going to add to the economic misery that Snowe at least seems aware is occurring.” There are currently 15 million Americans unemployed, and almost half of them have been out of work for at least six months — a post-World War II record. The House plans to vote on extending unemployment benefits again today, after an attempt to do so was blocked by 139 Republicans and 16 Democrats yesterday.
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