Why is Barney Frank allowing lobbyists to gut financial reform?
by ilene - December 8th, 2009 7:51 pm
Why is Barney Frank allowing lobbyists to gut financial reform?
Courtesy of Ed Harrison at Credit Writedowns
That is the question Newsweek asked of the Democratic Congressman from Massachusetts in charge of banking reform efforts in the U.S. House of Representatives in an interview. Rather than answer the question fairly, Frank attacked the reporter and eventually ended the interview. Don’t expect anything serious on financial reform from Congress.
So, we have a major, major financial crisis that almost causes the whole system to collapse. To ‘save the system’ taxpayers pony up $700 billion in bailout aid, another $800 billion line of credit to pay for the failure of bankrupt institutions, and tens of trillions for a plethora of government backstops. Immediately afterwards, banks go on to earn record profits and pay themselves record bonuses. And this is what we get for reform (emphasis added):
Not even critics accuse Barney Frank of being in the pocket of Wall Street. The real question is whether he and -others are being swayed by the legislative legerdemain that Wall Street lobbyists have long practiced. The story of how those loopholes got into the derivatives bill, even with Frank at the helm and the wind of public outrage at his back, shows just how powerful the Wall Street banking lobby remains—and how complex Wall Street’s financial instruments have become. "I don’t think he ever fully understood the legislation" in its early stages, says Greenberger. Many of the key lobbyists now are the same gang that helped get us into this mess before, and they’re spending huge sums once again. In the first three quarters of 2009, financial-industry interests have spent $344 million on lobbying efforts, putting them on pace to break all records, according to the Center for Responsive Politics. That’s just for lobbyists’ and lawyers’ salaries, junkets, and dinners, and doesn’t include political donations and issue ads. Even more impressive is the lobbying strategy that money is buying. According to insiders and industry e-mails obtained by NEWSWEEK, the banks have sought to stay in the background and put their corporate customers—a who’s who of American business, including Apple, Whirlpool, and John Deere—out in front of the campaign. "This is an orchestrated, well-funded effort by the banks to manipulate our legislation and leave no fingerprints," says a congressional staffer involved in drafting the
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Philip R. Davis is a founder Phil's Stock World, a stock and options trading site that teaches the art of options trading to newcomers and devises advanced strategies for expert traders...
Ilene is editor and affiliate program
coordinator for PSW.