I am not sure whether Potemkin reform is worse than no reform at all, except the latter makes it abundantly clear that America is in the hands of a corrupt plutocratic elite.
The latest, from the Huffington Post, is that the normal flurry of last minute amendments to gut legislation has gone one step further, in the case of H.R. 4173: Wall Street Reform and Consumer Protection Act of 2009. As Huffington Post reports:
A group of Democrats friendly to Wall Street interests forced a delay in consideration of the landmark financial regulatory reform bill scheduled to hit the House floor on Wednesday, Financial Services Committee Chairman Barney Frank (D-Mass.) told reporters in the Speaker’s lobby.
Frank accused the New Democrat Coalition of blocking the bill because its members are being prodded by big banks to abolish the Consumer Financial Protection Agency and to allow major financial institutions to avoid state laws tougher than federal regulations.
A Democratic leadership aide confirmed that centrist and conservative Democrats are threatening to vote no on the bill, leaving the caucus short of the needed votes
“The big banks in particular are trying to get more preemption,” said Frank. “It’s a state-consumer battle with the big banks. We want compromise. They want to offer an amendment that makes it easier to preempt state consumer laws.”
Gutting state authority over banking rules would deliver banks a victory, the polar reverse of the objective of this exercise, which is to rein the banksters in. Per CQ (subscription required):
House leaders are trying to settle a dispute between liberal and moderate Democrats that threatens to sideline, at least temporarily, a bill to overhaul regulation of the financial system.
The battle centers on two proposed amendments to the bill’s consumer protection provisions that moderate Democrats are demanding a vote on. Should those amendments not be made in order, members of the New Democrat and Blue Dog caucuses probably would vote against a rule to commence debate on the bill (HR 4173), a House aide said. That would in all likelihood quash the rule, given that Republicans are likely to oppose it unanimously.
But liberal Democrats are staunchly opposed to the amendments, and have threatened to abandon the bill if at least one of them is adopted. But the liberals also fear they do not have the votes to kill either amendment.
One amendment would allow federal regulators to preempt state financial laws and the other essentially would scrap the creation of a Consumer Financial Protection Agency.
“We still have some details to hammer out,” said Michael E. McMahon, D-N.Y., a New Democrat who has played a prominent role in the caucus negotiations over the final regulatory overhaul bill.
The amendment that would give the federal government the ability preempt state laws on financial protection issues is being offered byMelissa Bean of Illinois, a New Democrat. Supporters argue that, without it, financial companies would face a patchwork of state and federal regulations.
The other amendment, to replace the proposed consumer agency with a council of regulators that would oversee consumer protections for financial products, was offered by Idaho Democrat Walt Minnick, a Blue Dog.
The financial industry staunchly opposes creation of the agency, saying it will squelch innovation. The Chamber of Commerce is “whipping the vote hard” on the Minnick amendment, a House aide said.
The New Democrats were given a commitment that the amendments would get floor time, according to a House aide.
With House Republicans almost assured to vote with the New Democrats and Blue Dogs on both amendments, the House would likely adopt both measures if they came to a vote.
Liberal Democrats have fought hard against both proposals. They are critical of federal regulators for failing to curb the sort of predatory credit practices that came to light during the financial market meltdown, and want to keep state powers intact. But they also see a new federal consumer protection agency as a cornerstone of the overhaul.
House Financial Services Chairman Barney Frank said late Wednesday afternoon that the decision on what amendments to allow is now entirely up to House leadership. The New Democrats are currently in negotiations with leaders and Treasury Department officials, according to Frank and House aides.
“I told the liberal coalition that they may have gone further” in achieving their agenda during the committee markup than they could hold onto when the bill got to the floor, said Frank, D-Mass.
But that hasn’t kept liberal members of the caucus from issuing a threat similar to the New Democrats’ — a “no” vote on final passage if Bean’s amendment is attached.
“I would vote against this bill if it preempted state law,” said Brad Miller, D-N.C.
This is making me ill.
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Well, maybe they can use the impasse to work that 50% tax on Wall Street bonuses.
Well the EU is eyeballing such taxes now:
http://news.bbc.co.uk/2/hi/europe/8405214.stm
Goldman strikes in “anticipatory self-defense”:
http://news.bbc.co.uk/2/hi/business/8406860.stm
And the bail-out is just a deadweight loss to the Republic’s finances:
http://www.bloomberg.com/apps/news?pid=20601103&sid=aQPLZEq2sd7s
It’s become very clear that we had much better government in 1929 than we have currently.
Our representatives can’t see the light. Hence, they need to feel the heat…a scorching heat.
When are we all going to do something about this? Enough is enough! We are being robbed in broad daylight, on a daily basis, and our representatives, who are supposed to be acting on the behalf of their constituents, choose to look the other way while the robbery is taking place. I am serious, I’ve had enough, what can we do about this?
Simple enough, stop using their money.
You are doing something even now by learning and networking to form a clearer common vision for a healthier society, economy, and ecology. Keep the faith. Though maddening and fearful, history shows that the most dark and trying times are essential springboards for leaps forward when the unsustainable finally collapses—as this certainly will.
If the collapse is not too apocalyptic, in say 2012, there’s already a revolutionary critical mass building right now that will be well-prepared at the critical time to fill the current vacuum of moral leadership. Later, ee will look back in wonder at our harrowing passage.
Actually, and not to be at all cynical, our representatives ARE acting on behalf of their constituents. Those just don’t happen to be the American people.
+1
Stop using credit.
Not a simple task, but doable in the generations ahead. We need to live with what we have, not what they want us to have. They give us stuff, we pay more for it in the long run than if we just saved up front. That is not what the financial industry wants us to do. They need us to take loans. They need us to pay with credit for those coffees, jeans, and groceries. Stop using credit wherever possible. Its not going to change overnight, but this is something everyone can do. Just get use to the lifestyle change under your control, opposed to that could be because we are forced to based on the value of our dollar dropping even more.
See, if we can remove the power and influence the financial industry has today by removing the revenue they make off of our debt, then they will have no choice than to make a change to the system they are use to running.
On this note did any one catch Elisabeth Warren on CNBC the other day? Her persona on MSM has under gone a 180 degree shift, some mealy mouth assertion that IBs after pay back of TARP are under the threat of taxpayer backed ratings, via the saintly ratings agency’s auspices from A to BBB bawwwwahahahaha!
Get your GS tatoo now! Repent and convert or death will be the good option!
Barney Frank is the worst of the worst. He always talks a big game, but he is 100% in the bankers’ corner.
They all are now, save those that would create friction too advance their status via popularity and benefit from it…eh.
We no longer have a republic by the people, but by the masters of finance. And their siren song of consumerist punishment for not toeing the line is their club. What a weak and petty lot we have turned into.
When the Universe applies its laws many will squirm in their own private hells, me thinks.
Mr. DownSouth you must be in exasperating pain by now, at some point one must cast off the affections and prepare for
the inevitable out comes old boy, some times kittens must die..tis inevitable unfortunately.
Did we see the same interview on Squawk Box? I understood her point to be: The IB’s with TARP funds now are rated A (or Aaa, not sure) but that sans their TARP, they’d only be BBB. Yes or no? Mealy-mouth? Maybe my coffee hadn’t kicked in …
If they can see the bullet in the cylinder yes, but I fear by the actions of date that said cylinder is dry.
Does it drive anyone else crazy that Barney Frank constantly talks about other congressmen being beholden to special interests as if he himself is not beholden to different but equally bad special interests? The lesson, as always, is become a part of the ruling elite if you can because no one else can expect much good from our government.
Yes, Barney Frank brings fresh meaning to words like hypocrisy and bluster. But remember, he’s a “liberal” (which shows the meaninglessness of that term).
Barney is either getting fucked or being fucked by the banks, look into who his boyfriend is, Ready.
This would be an issue if they were not gay.
The MSM won’t touch this issue, and the only reporting on it is done by fox which I will not link to.
There are some interesting links to a story about his BF growing weed at a house in Maine too. Seems recent. Barney was there for the seizure.
Just to be clear, in this new era of transparency I think we should finally ask who is a top, and who is a bottom. Seeing as how the taxpayer is clearly part of this weird orgy, we might just want to ask a few questions about who is doing the fucking.
“This would be an issue if they were not gay.”
Don’t bet on it. There are plenty of heterosexuals in politics whose spouses raise interesting conflict-of-interest questions. It’s a toughie because how can you tell a spouse what they’re supposed to do for a living?
Better just to concentrate on the plain fact that Frank is a shill for the banksters. Bribes (oops, I mean campaign contributions) are usually a major factor, but other than that does it really matter what the source of his corruption is?
“There are some interesting links to a story about his BF growing weed at a house in Maine too. Seems recent. Barney was there for the seizure.”
So what? Tell him to smoke one for me.
So what? I know people who have gotten in trouble for this, they didn’t keep their high paying ‘public-private’ executive job. At the least they get a weekly appointment with a PO.
I am not a partisan, and do not tolerate any ‘-ism’s’ in my personal life, but this just gets more and more murky. There should be some very serious questions asked.
The most famous partisan couple, Carville and Matalin, cannot go anywhere without being asked about the other. How many times do you hear barney asked about his significant other? About his views on banking?
The only reason they are not asked is because the MSM would have to admit that Barney has a boyfriend. How icky…
This is not equal rights, this is not on the road to equal rights, this is using the homophobic MSM as cover for a very clear conflict of interest.
OK, I went over to the fox pages to look around.
I did get the relationships wrong.
He was dating Herb Moses from 1991-1998, when Herb left fannie. This is the relationship that is most suspect, and the press was even less likely to scrutinize it in the 1990’s.
The current agriculturist/surfer (Jim Ready) is the one who got caught growing weed. Barney was on the front porch when the cops stopped by to talk about some plants that were in the yard.
Barney issued a statement where he said that he would not know marijuana if he saw it growing, and that he asked Ready to ‘…not do it again’.
Lets just say Ted Kennedy was hanging out at his girlfriends house and the cops stopped by and found marijuana in the front yard. Ok, can you name anyone who would not be questioned by the press about this?
I was blowing smoke. I didn’t find any conflict of interest, but a few good stories. None in the MSM.
Melissa Bean?
Her name is popping up way too frequently for her own good. She’s clearly a tool of the banksters, yet, NO ONE in the MSM is singling her out.
“Gutting state authority over banking rules would deliver banks a victory”
Well…duh!
Anyone remember Spitzer battle with the REMFs at the Office of Thrift Supervision?
New Democrat?
Is this Newspeak for “absolutely corrupted asshats beholden to special interests that happen to be Democrats”?
Yes, although for most purposes both terms can be shortened to “Democrat”.
for most purposes both terms can be shortened to “Democrat”.
Then how will we distinguish them from “Republicans”?
Size of the pubic/public strap on?
I don’t know charcad, I’m having trouble telling the difference myself.
Bernie Sanders (sensibly) making common cause with Ron Paul and Sen. Bunning? Last time I heard of such strange bedfellows is when the Chinese Communist Party decided to promote capitalism.
Republicans leave the lights on and laugh while they fuck you up the ass.
Democrats turn off the lights and whisper sweet nothings in your ear while they fuck you up the ass.
lol nice one glen
Colloquially expressed, but essentially correct.
Republicans think that there should be no regulations. Democrats think the bankers should write them. Next question . . . .
BTW, anyone has heard of Alan Grayson on that one? IIRC, he sits on the Committee.
This is making me ill.
Had high expectations of a Democratic Congress and Administration, did we? ;-)
Please, I had no expectations for Obama. And I thought (and say clearly in my book) that financial reform will come to naught. But it is quite another matter for the looters to not merely forestall reform, but actually extract a massive victory, within a year of wrecking the global economy. By contrast, the UK, whose FIRE sector is a bigger % of GDP than in the US, is imposing a 50% bonus windfall tax on their banksters. The contrast could not be more clear.
The audacity of gall is truly breathtaking. I can’t help wondering, though, if what looks like naked greed and power lust may be really a manifestation of fear—a desperate attempt by the powers that be may to keep the curtain closed. Once the all-knowing wizard of rigged trade is exposed as a feeble, senile goblin then their emerald city will shatter.
Once again the Brits make me long for there system of governance. Let us have out Constitutional Congress called by the states so we can jettison this republic for one better.
bleh, their. Back to the wine.
The fact of the matter is that the US public hasn’t suffered enough. I don’t say that as a judgment but as an observation. That is exactly why such massive effort was exerted last year to force a TARP over the problem, and otherwise kick the can down the road. Because the large, fat middle of the electorate doesn’t want _any_ change, they just want to get back to ‘normal.’ And the shoddy, shabby, puppets inside the Beltway have pretzelized themselves to deliver a semblance of normal, so there is no push on mainstreet or in suburbia or in the heart of the heart of the country for any real ‘change.’ That is just why so many jumped on the O train, all talk of change, all walk of same old same old.
It’s been my view from the complete capitulation of the O Admin in the odious ‘stress less’ tests that we would not and will not get a shred of reform until things really crash through the floorboards. Just look at our ‘health reform,’ a huge win for the insurance industry which will institutionalize themselves as the recipients of tax receipts for which they get to ration health care.
. . . No reform until total failure—so it can’t come too soon. Not an inviting prospect to root for; no, not. But . . . .
From what I can tell, the difference in approaches between the US and the UK is that in the US we are playing this out as an end-game. In the UK, they are pretending there is a future in which someone might suffer.
The problem with an end-game approach is that all the rules go out the window. Every rule, gone, because there will be no one left to enforce them or to exact penalties for the rules having been broken.
Think about what it means to be in an end-game, and everything in the US starts to make sense. It’s the prospect that we’re going down — hard– that make me ill.
cougar
Charcad, political/idealogical definitions are a moot point moving forward….did you not get the memo, its all about money and whom the bell tolls for…bow down to your new master salve!
BTW salve was not a typo, ye are but the lube they smear upon their erections of desire, how does it feel to be anal lube, old chum?
Republican, Democrat pahffft! Both will love ya too death over their entitlements of office and the longevity inherited as beholden to their family legacy upon sheepskins in perpetuity.
I only expected normal disappointment – but I haven’t yet achieved your level of cynicism about all things, all people, all hopes, and all ideas.
Ahh Mr Raithel, my doppelgänger of sorts. I might feel better if your produce was on offer, but alas I will never taste your toils delights. Me thinks you tend all your vines to the highest standard and the quality will show for generations, upon the tongue and thy ear.
I still miss the old thrashers/strawberry convention’s with my GF…these generations will not hear their wisdom.
i know we’re far away and irrelevant down here, but it’s the headline i liked –
http://www.businessspectator.com.au/bs.nsf/Article/Central-banking-for-grown-ups-pd20091209-YK3GQ?OpenDocument&src=kgb
Actually, as irrelevant as you are (sic) the article you linked is quite relevant. It has a number of observations on a situation we (unfortunately) share, the recent financial discombobulation and more importantly, how is it being dealt with.
Reserve Bank governor, Glenn Stevens seems to not only have a better analysis on problems regulating Australian fiscal structure than certain high profile members of our local FED bureaucracy (more “erudite”), but to have advanced (relative to U.S. efforts, yet even zip could be improvement over negative regression) into regulatory environment with a understanding of the practical implications of moving in that inevitable direction. Among his observations: that regulation, specifically lower risk acceptance by financial institutions is going to cost money. Given for requirement for more high-quality liquid assets, the consolidation of the Australian banking industry do to the crisis and the subsequent loss of competition, the end-use consumers are the ones on the hook for the extra costs of doing business, in the form of higher interest charges and fees they (the consumers) will be required to pay.
The concern there though seems to be not that interest rates will be higher, but that this will likely open the flood gates once again to a more competitive, more profitable, albeit a higher risk financial innovation enterprise run by a now dormant shadow banking industry, small private equity houses, or some other similar beast of destructive potential yet to identified. You can regulate the main culprit, but you better have some idea of the consequences and how you, as a regulator, are going to deal with them and the toughness to carry it through.
You want to do something about the state of The State?
I’m not from the government, and I’m here to help.
http://americanrevt.blogspot.com/2009/09/first-principles-and-basic-precepts.html
What we are seeing is the complete and total corruption of our elites. The Republicans, Frank, Dodd, Obama, Bean are engaged in competition, not opposition. They differ only in that they are pursuing various strategies on how to sell out, whom to sell out to, and at what price.
Except for the one provision to audit the Fed, the reform bills are garbage. None of them deal with the fundamental restructuring of the financial sector that is needed. The banks got everything they wanted in the derivatives bill. The CFPA has been gutted, but just as we saw with the eviscerated public option in the healthcare debate, industry players have no reason not to go ahead and try to kill the CFPA off entirely. I mean what’s the downside for them? Nobody in Congress or the White House is going to exact a penalty from them over it. And as we also see everyday the public is completely ignored by both government and Wall Street. So why not go after the tattered remnants of the CFPA? And Bean’s attempt to force weaker national standards down the throat of the states is just more of the same.
Everyone nowadays seems to be following the philosophy of Dick Cheney’s hatchetman David Addington:
“We’re going to push and push and push until some larger force makes us stop.”
This will not stop until all of the banksters and most of the politicians are behind bars, or until they run the country well and truly into the ground, or both.
What caught my eye was this, and it is nothing new, but it does always come up:
“Supporters argue that, without it, financial companies would face a patchwork of state and federal regulations.”
I think one of the things I’ve learned from this site is: if there is an opportunity for the owner of some transportable asset to choose between regulations, the opportunity for arbitrage exists. We’ve read much that some of what put us here was regulatory arbitrage.
By coincidence – or not – the links of 12/9 included the Rolfe Winkler piece, a perhaps too brief and conclusive claim that local politics in Ohio interfered with the FDIC taking a bank, and consequently, taxpayers might (might – probably?) pay for that interference. I think Rolfe’s moral is: No no no.
Now, I won’t argue that Congressman Bean isn’t the meretricious shite that many of you say she is – odds are, she is. Still, difficult ideas are cynically mined for ulterior motives, and the difficult idea itself remains apart from her –
The easiest, quickest, analogy to use for justifying state’s rights over fed regulation is to the exceptions granted California during the earliest days of federal environmental regulations. So I get it. But I’m still looking for the coherent set of standards, such that one can consistently defend a national standard against local interests (the FDIC taking banks in Ohio, against local, “populist” resistance) and still claim an exception from that central authority…
The American Civil War goes on, and on, and on….
The coherent standard the people want is simple. States have the right to enact stronger regulation than the federal standard, but never weaker.
There’s no such thing as a “patchwork”. That’s a fraudulent right-wing talking point. If someone doesn’t like the stronger regs the people of a particular state have enacted, he’s free to not do business with them.
If he chooses to go ahead anyway, then he’s voluntarily accepting the regs. Part of the business contract, right? Free market, baby!
House leaders are trying to settle a dispute between liberal and moderate Democrats that threatens to sideline, at least temporarily, a bill to overhaul regulation of the financial system.
Here we go again with this vile media framing, where right-wing and/or obviously corrupt Democrats are called “moderates” or “centrists”, while the people, and any Dem who wants to vote for what the people want, are called “liberal”.
In this case the malevolence of this framing is even more severe than in the case of health “reform”.
Let’s be absolutely clear: the corporatist MSM is not only grotesquely inadequate to the needs of democracy, it is by now actively, aggressively treasonous.
The same is true of most in Congress and among presidential candidates.
This government is utterly broken, corrupt beyond redemption. Potemkin reform is worthless in itself, and anyway never exists in simply neutral do-nothing form. On the contrary, it’s always a disaster capitalist hijacking, where the nominal “reform” vehicle is used as an aggressively anti-reform weapon.
So again this is just like health reform but far worse. Here too, it’s better to just do nothing so long as these criminals are in power.
As Yves points out, this would at least have the virtue of rendering the utter criminality of this government absolutely clear to a wider audience.
Hear hear to attempter’s last two posts, especially the final one.
This whole financial reform theater strikes me as being a missdirection from the fact that a large part of what has occurred, and is continuing, is the fact that we have been subject to a stunning abrogation of regulatory authority.
I’m not so sure that we need sweeping reforms, well the resurection of Glass-steagell would be worthy, as much as we need to have the existing laws enforced.
Fraud that goes unprosecuted fosters fraud. The financial services lobby is doing a masterful job of papering over the fairly obvious fraud that has occurred and moved the focus of legislation to venues that have little bearing on the failure of the regulatory agencies to do their job.
Prosecuting insider trading is helpful. The real problem, however, is that which obtains from the trade in derivatives. There was a time when if you wittingly made a trade that you could not honor, you went to jail. You can howl all you want about excess leverage and stupidity, but the simple criterion is can and will you honor the contract.
A consumer protection agency is more palaver for the public. While true it might help to protect the consumer, it will also make the consumer more prone to profligacy. At some point the consumer has to be responsible for his actions in equal measure as to the enterprise that seeks to exploit him.
A failed financial reform bill might be a better outcome if the ultimate result is legislation that addresses a resurection of Glass-Steagell.
what ‘banking’ should do for our society
Our comprehensive frame of reference regarding what ‘banking’ should do for for our society – what we require from it – remains glued in an irrational, clinically, perhaps cynically dysfunctional mindset.
This ‘public utility’ – which is what banking is, appropriately, intrinsically – is not something that, when functioning properly – is directed by entities who are in any way autonomous – who have interests that have priority over the public. Why ‘banking’ is treated any differently than regional electric utilities is only due to systemic, comprehensive political corruption. This corruption perhaps eclipsed with the final destruction of Depression-era banking regulations so loathed by investment banking, smelling fresh meat: signed or celebrated by Robert Rubin, Phil Gramm, Bill Clinton, Larry Summers, Tim Geithner, the ‘Maestro’ Greenspan, inflationist Bernanke – all.
We are instructed by Rubin luminaries Larry Summers and Treasury clerk Tim Geithner and money printer Bernanke that all we have to do — is simply believe.
The vision that we have been sold is that all we have to do is ‘use’ all the newly printed $dollar markers – and someone will take them and give us something in return. It doesn’t matter that the Administration is printing them out of thin air, because all the promises will be backed by the full faith and credit of the Administration, and that will continue to mean something to those of us on this planet that are not American, who coincidentally also make the things we want. As best I can tell, it appears to be simply assumed that (contrary to accumulating empirical data) regardless the level of currency inflation — that it will, effectively, never matter.
Neo-conservative* economic theory** that has dictated US fiscal policy for the last 40 years is predicated on perpetual growth.
Growth – preferably growth in the rate of growth – perpetually, every quarter, is both virtuous and divine, while also intrinsically irrational within our ‘closed’ planetary system and sociopathic in its resultant destruction. It’s also entirely mandatory – like a shark that must consume to move to breathe to live to consume.
As we may perceive now, without fresh ‘meat’ in – there is little ‘sausage’ out, no matter how fast the crank is spun.
—–
* … and, ironically by name, near-identical neo-liberal ideology of the earlier Kirkpatrick stripe and era.
** … perhaps developed as a prophylactic, hegemons’ response to the long-range geo-political ramifications of Nixon toppling the $dollar off the Au wagon?
Part of the problem is that too many Americans are not even aware of the pain and suffering others are going through. Heck, even though I am aware of it I am not feeling it and thus cannot fully comprehend it. But at least I try to stay aware of it.
The other problem is lack of compassion. It amazes me how easy it is for some to look down on or belittle others. If more were made aware of the horrible situation others are in right now I have to wonder how many would care.
An appropriate analogy for America right now might be the Titanic. Sad days indeed. :-/