“Pundits will spend a lot of time predicting who will win in November. But more is at stake than the fate of Democrats or Republicans. What’s at stake is whether the powerful corporate special interests will go back to writing our laws or whether our democracy will remain where it belongs — in the hands of the American people.”
What color is the sky in the land where unicorns run free, Dave? “Go back?” They never left. Former insurance company lobbyists and executives wrote the lion’s share of health care “reform.” Your boss cut a backroom deal with the pharmaceutical industry to ensure their monopoly remained intact. Did the big banks get broken up by so-called financial reform? Hell no. Is too big to fail still around? Hell yes. Does the military-industrial complex still get the same blank check that they’ve always had? Absolutely.
FYI, Mr. Axelrod, we no longer have a democracy in America. The correct term is oligarchy.
A couple of things don’t make sense in this debate over letting the tax cuts for the top 2% expire. Don’t make sense on the surface, that is. Dig a little deeper and it becomes perfectly clear.
Why is there such angst in Congress about raising taxes on the wealthy? Members of both the House and the Senate in both parties say they are so concerned with the deficit, but yet extending the cuts will add about $700 billion to the deficit. Many say raising taxes will kill job creation, but those same cuts led to little or no job creation during the 9 years they have been in effect. So what’s the big deal about raising taxes on millionaires?
Because they would be voting to raise taxes on themselves. One percent of Americans are millionaires, but 44% of the members of Congress are millionaires—237 out of 535. They would be voting not only to raise taxes on themselves, but their friends, their associates, and most importantly to them, the people who write the large campaign contribution checks.
Here’s the other thing that doesn’t appear to make sense. Naturally, most Republicans are against letting the cuts expire, for no other reason than that President Obama is in favor of it. But why are an increasing number of Democrats coming out in favor of an extension? Besides the fact that many if them are included in that number of millionaires, that is.
I know some probably get tired of me beating the drum for the importance of organized labor, but unions were once the largest constituency group and voting bloc who stood up and spoke out for working and middle-class people. Into the “vacuum” left by decreasing union membership and its influence on politicians and policy has stepped corporate interests and their money. From Winner-Take-All Politicsvia Kevin Drum at Mother Jones:
“Unions…are the particular focus of business animus. As they decline, they leave a vacuum. There’s no other nationwide organization dedicated to persistently fighting for middle class economic issues and no other nationwide organization that’s able to routinely mobilize working class voters to support or oppose specific federal policies.
With unions in decline and political campaigns becoming ever more expensive, Democrats eventually decide they need to become more business friendly as well. This is a vicious circle: the more unions decline, the more that Democrats turn to corporate funding to survive. There is, in the end, simply no one left who’s fighting for middle class economic issues in a sustained and organized way. Conversely, there are lots of extremely well-funded and determined organizations fighting for the interests of corporations and the rich.”
In my opinion, this also explains why some who vote Republican and support Republican policies, other than those who are simply anti-anything Obama related, are against raising taxes on the wealthy even though very few would be affected by an increase on those making over $250,000 a year. They’ve bought into the corporate-interest saturated media theme that unions are evil and that the wealthy special interests are looking out for them.
“They’re coming for your Social Security money. They want your retirement money. They want it back so they can give it to their criminal friends on Wall Street.”
“…an examination of the American tax code indicates that oil production is among the most heavily subsidized businesses, with tax breaks available at virtually every stage of the exploration and extraction process.”
Take, for instance, two of the major players in the Gulf oil spill—Transocean and BP:
“When the Deepwater Horizon drilling platform set off the worst oil spill at sea in American history, it was flying the flag of the Marshall Islands. Registering there allowed the rig’s owner to significantly reduce its American taxes.
The owner, Transocean, moved its corporate headquarters from Houston to the Cayman Islands in 1999 and then to Switzerland in 2008, maneuvers that also helped it avoid taxes.
At the same time, BP was reaping sizable tax benefits from leasing the rig. According to a letter sent in June to the Senate Finance Committee, the company used a tax break for the oil industry to write off 70 percent of the rent for Deepwater Horizon — a deduction of more than $225,000 a day since the lease began.”
Congress and the Obama administration are working (allegedly) on legislation that would cut $20 billion in oil industry tax breaks. The response from the oil companies? One wrong move and the economy gets it:
“Jack N. Gerard, president of the American Petroleum Institute, warns that any cut in subsidies will cost jobs. “These companies evaluate costs, risks and opportunities across the globe,” he said. “So if the U.S. makes changes in the tax code that discourage drilling in gulf waters, they will go elsewhere and take their jobs with them.”
What are the chances of Congress eliminating these subsidies? Slim and none:
“Efforts to curtail the tax breaks are likely to face fierce opposition in Congress; the oil and natural gas industry has spent $340 million on lobbyists since 2008, according to the nonpartisan Center for Responsive Politics, which monitors political spending.”
An example is Sen. Robert Menendez (D-NJ) who is co-sponsoring the legislation that would end the tax breaks, but:
“While the legislation would cut many incentives over the next decade, it would not touch the tax breaks for oil refineries, many of which have operations and employees in his home state, New Jersey.”
Scott Brown is a quick learner. In his short time in the Senate he’s become a master at the game of ‘How To String Along The Gullible Democrat’ aka Lucy and the Football.
Here’s how it goes: Obstructionist Republican says, “I would vote for this particular piece of legislation except for X.” Gullible Democrat believes Obstructionist Republican (although for the life of me I can’t figure out why) and changes or takes out X. Obstructionist Republican then says, “That’s all well and good, but I also don’t like Y. If you take that out too, I may vote for said legislation.” Gullible Democrat removes Y, and the process repeat itself over and over until said legislation is either dead or too weak to do anything remotely resembling its original intention.
The latest example is the so-called financial reform bill. Brown wanted a loophole in the Volcker Rule to exempt banks in Massachusetts from being subject to limits on risky investments. With the help of Barney Frank and (surprise!) the Treasury Department, the loophole was inserted into the legislation. (BTW, also at the insistence of Senator Brown, another loophole was added to the Volcker Rule which may delay its implementation until 2022.)
Brown’s objection to the bill then shifted to a $19 billion fee to be collected from large financial institutions, calling it a “tax.” I’m sure Brown’s opposition has absolutely nothing to do with the $450,000 he received from executives at financial institutions in the six days before the election in Massachusetts. Strictly coincidence..
“Top Democratic House and Senate negotiators who worked out a deal on a sweeping overhaul of financial regulations regrouped Tuesday to eliminate a $19 billion fee on banks that had threatened to derail the legislation.”
Brown wasn’t alone. He had two other Lucies standing with him:
“Besides Brown, Republican Sens. Olympia Snowe and Susan Collins of Maine, both of whom also voted for the Senate bill last month, said they, too, had qualms about the bank assessment that negotiators inserted into the bill last week.”
I guess the only alternative to the Democrats being gullible and naive is that they are complicit and corrupt. That they don’t really want actual reform and are just using the guise of compromising with the Republicans to play their favorite game—giving the appearance of doing something while in reality doing nothing which might upset the goose that lays the golden eggs of campaign contributions.
Gullible and naive or complicit and corrupt? Either way it doesn’t bode well for the future of the Republic.
With the conference committee set to start meeting today to come up with a final version of financial reform legislation, the finance industry whores on the committee (aka Barney Frank and Chris Dodd) are doing their best to backpedal on Blanche Lincoln’s provision to force the big banks to spin off their derivatives operations.
“Senate Banking Committee Chairman Chris Dodd [$3.1 million from Finance Industry PACs], a skeptic on the Lincoln plan, called it a “strong provision” and said she “was on the right track.” He did not, however, agree with his Democratic colleagues Wednesday who said Lincoln’s election win would make it harder to eliminate the provision.
And Frank [$2.3 million], who is chairing the conference committee, gave no indication Wednesday of where he intended to steer the House-Senate conference on the issue.”
No big surprise here either:
“The plan faces opposition from the administration, the Treasury Department and the Federal Reserve.”
Financial reform is once again on the agenda as the House—Senate conference committee attempts to reconcile the differences between the 2 bills beginning on Thursday. This article from McClatchy doesn’t give me reason to be optimistic about the outcome:
“A group of lawmakers who are about to write an historic overhaul of the nation’s financial regulatory system has been stacked carefully with veteran compromisers — and one wild card.”
“Veteran compromisers.” To me, that translates into someone who doesn’t stand for anything. A typical politician with a moistened finger of one hand in the air to see which way the wind is blowing, while the other hand reaches for the largest campaign contribution.
“That’s Sen. Judd Gregg, R-N.H., a flinty Yankee individualist who briefly was set to be President Barack Obama’s commerce secretary before he changed his mind. Gregg’s expected to be the leading proponent of GOP and financial sector views, and therefore a key player in shaping the final legislation.”
An “individualist” who is “expected to be the leading proponent of GOP and financial sector views?” Can you say oxymoron? More like a party-line hack who is in the pocket of the financial sector to the tune of $710,000 from financial industry PACs, and who has a 78% approval rating by the US Chamber of Commerce for his pro-business voting record.
“Gregg, who’s retiring from the Senate after this year, thinks some features of the legislation that initially passed the Senate and the House of Representatives amount to dangerous liberalism. He’s unenthusiastic about expanding government oversight of banks and other financial institutions, and creating a powerful new agency to protect consumers’ financial interests.”
In other words, Gregg is for the status quo. No new regulation necessary, leave it in the hands of private business. That’s worked so well in the Gulf of Mexico, why not do the same for Wall Street. “Dangerous liberalism?” Can it be any more dangerous than the hands-off, let the market fix itself attitude that nearly led to Great Depression, Part II?
“This bill doesn’t break down conservative-liberal. This bill breaks down populist-rational,” he said. He cited a desire in both parties to punish Wall Street and show voters that Congress can get tough with the financial sector, but he fears that could go too far.
Wrong, Senator. It breaks down along what’s in the best interest of the people vs. what’s in the best interest of the big bankers, and it’s pretty clear what side you come down on there. Go too far? These greedy SOBs nearly caused the collapse of our economy and put millions of people out of work. Is there such a thing as going too far?
“Financial interests, which also fear the bill will overreach, hope Gregg can bridge differences. “He will help to serve as an honest broker to achieve consensus among the conferees,” said Scott Talbott, the chief lobbyist for the Financial Services Roundtable, the trade group for big financial firms.
“Honest broker.” Right. As honest as $710,000 will allow. And as usual, Democrats are sending the fox an engraved invitation to the henhouse:
“Democrats say that not only will Gregg be invited in, he also could become a crucial voice as deliberations progress.”
Which tells me one of two things. Either Democrats have a serious case of amnesia and don’t remember that no matter what Republicans say, they are there to block what they can and weaken the rest until it amounts to nothing, or Democrats on the committee don’t want real reform and Gregg is their useful idiot.
“A financial regulatory reform bill has at least one supporter outside of Congressional Democrats, Lloyd Blankfein, the head of investment bank Goldman Sachs. “I’m generally supportive,” Blankfein told the Senate Permanent Subcommittee on Investigations. Wall Street will benefit from the bill because it will make the market safer, Blankfein said.
“The biggest beneficiary of reform is Wall Street itself,” he said.
I think one of the commenters at The Hill has the right analogy. “Oh please don’t throw me in the briar patch, said Br’er Rabbit.”
“For the first time since 2004, the biggest Wall Street firms are now giving most of their campaign donations to Republicans.
A Wall Street Journal analysis of 12 large financial services companies, including J.P. Morgan Chase & Co., Goldman Sachs Group Inc. shows that they have collectively made $1.4 million in political donations, with 52% going to Republicans so far this year.”
“Financial weapons of mass destruction” eh, Warren? What’s up with this ? (emphasis added) :
“The Senate Agriculture Committee inserted language into its derivatives bill last week [a provision pushed by Warren Buffett’s Berkshire Hathaway Inc] at the request of Sen. Ben Nelson (D., Neb.) that would have exempted any existing derivatives contracts from new collateral requirements—the money set aside to cover potential losses…a change one analyst predicted could force the Nebraska company to set aside up to $8 billion.
Berkshire has $63 billion in derivatives contracts, and Mr. Buffett has boasted he holds very little collateral against these products.”
Then after that was taken out of the legislation, lo and behold Buffett’s boy Benny:
“…did an abrupt about-face and became the only Democrat to help filibuster legislation to revamp Wall Street regulations…”He was on board until today and the only thing that changed was the removal of that provision,” said one Democratic aide, who definitively said Nelson changed his vote because the Buffett carveout was removed.”
Yes boys and girls and sports fans everywhere, the Orifice of Omaha is just another member of the oligarchy, gaming the system for his own personal gain. And Benny Nelson is nothing more than his errand boy.
“We are united in our opposition to the partisan legislation reported by the Senate Banking Committee. As currently constructed, this bill allows for endless taxpayer bailouts of Wall Street and establishes new and unlimited regulatory powers that will stifle small businesses and community banks.”
All words straight out of a Frank Luntz memo, telling Republicans how to maintain the status quo while sounding like they are in favor of reform. In other words, just repeat the Luntz-inspired tactics from the health care debate, with “endless taxpayer bailouts” replacing “death panels” as the lie du jour. And a lie is exactly what it is. What will guarantee “endless taxpayer bailouts” is doing nothing. The proposed reform calls for applying the same process to the “too big to fail” institutions that the FDIC uses every day for dealing with banks that become insolvent.
Would this bill perpetuate bailouts? SHEILA BAIR: The status quo is bailouts. That’s what we have now. If you don’t do anything, you are going to keep having bailouts.
But does this bill stop them from happening? BAIR: It makes them impossible and it should. We worked really hard to squeeze bailout language out of this bill. The construct is you can’t bail out an individual institution – you just can’t do it.
If this had been law prior to 2008, would we have seen the bailouts that took place? BAIR: No. You could not do an AIG, Bear Stearns, or any of that…This bill would only allow system-wide liquidity support which could not be targeted at an individual firm. You can’t do capital investments at all, period. It’s only liquidity support. No more capital investments. That’s banned under all circumstances.
Do you see any way left for the government to bail out a financial institution? BAIR: No, and that’s the whole idea. It was too easy for institutions to come and ask for help. They aren’t going to do that. This gives us a response: “Fine, we will take all these essential services and put them in a bridge bank. We will keep them running while your shareholders and debtors take all your losses. And oh, by the way, we are getting rid of your board and you, too.”
Here’s all you need to know about the dishonesty of Senate Republicans. One provision of the bill is for a $50 billion fund to dismantle the “too big to fail” banks. The fund is made up entirely of money which comes from the big banks, not one thin dime from the taxpayers. Republicans want this provision removed. But even if it goes, will they support the remainder of the legislation? I think you can guess the answer:
“McConnell suggested it wouldn’t be enough to satisfy Republicans.
“I appreciate the Obama administrations recognition of the need to substantively improve this bill,” McConnell said. “And I hope we can work with them to close the remaining bailout loopholes that put American taxpayers on the hook for financial institutions that become too big to fail.”
Oh by the way, how did the $50 billion get into the legislation to begin with? It was the result of negotiations between Banking Committee members Mark Warner (D-VA) and Bob Corker (R-TN). Needless to say, Corker now opposes the fund he negotiated to include.
Desperado's Outpost 