“Democrats, Republicans And Wall Street Tycoons”: Financiers Resent Any Constraints On Ability To Gamble With Other People’s Money
Hillary Clinton and Bernie Sanders had an argument about financial regulation during Tuesday’s debate — but it wasn’t about whether to crack down on banks. Instead, it was about whose plan was tougher. The contrast with Republicans like Jeb Bush or Marco Rubio, who have pledged to reverse even the moderate financial reforms enacted in 2010, couldn’t be stronger.
For what it’s worth, Mrs. Clinton had the better case. Mr. Sanders has been focused on restoring Glass-Steagall, the rule that separated deposit-taking banks from riskier wheeling and dealing. And repealing Glass-Steagall was indeed a mistake. But it’s not what caused the financial crisis, which arose instead from “shadow banks” like Lehman Brothers, which don’t take deposits but can nonetheless wreak havoc when they fail. Mrs. Clinton has laid out a plan to rein in shadow banks; so far, Mr. Sanders hasn’t.
But is Mrs. Clinton’s promise to take a tough line on the financial industry credible? Or would she, once in the White House, return to the finance-friendly, deregulatory policies of the 1990s?
Well, if Wall Street’s attitude and its political giving are any indication, financiers themselves believe that any Democrat, Mrs. Clinton very much included, would be serious about policing their industry’s excesses. And that’s why they’re doing all they can to elect a Republican.
To understand the politics of financial reform and regulation, we have to start by acknowledging that there was a time when Wall Street and Democrats got on just fine. Robert Rubin of Goldman Sachs became Bill Clinton’s most influential economic official; big banks had plenty of political access; and the industry by and large got what it wanted, including repeal of Glass-Steagall.
This cozy relationship was reflected in campaign contributions, with the securities industry splitting its donations more or less evenly between the parties, and hedge funds actually leaning Democratic.
But then came the financial crisis of 2008, and everything changed.
Many liberals feel that the Obama administration was far too lenient on the financial industry in the aftermath of the crisis. After all, runaway banks brought the economy to its knees, causing millions to lose their jobs, their homes, or both. What’s more, banks themselves were bailed out, at potentially large expense to taxpayers (although in the end the costs weren’t very large). Yet nobody went to jail, and the big banks weren’t broken up.
But the financiers didn’t feel grateful for getting off so lightly. On the contrary, they were and remain consumed with “Obama rage.”
Partly this reflects hurt feelings. By any normal standard, President Obama has been remarkably restrained in his criticisms of Wall Street. But with great wealth comes great pettiness: These are men accustomed to obsequious deference, and they took even mild comments about bad behavior by some of their number as an unforgivable insult.
Furthermore, while the Dodd-Frank financial regulation bill enacted in 2010 was much weaker than many reformers had wanted, it was far from toothless. The Consumer Financial Protection Bureau has proved highly effective, and the “too big to fail” subsidy appears to have mostly gone away. That is, big financial institutions that would probably be bailed out in a future crisis no longer seem to be able to raise funds more cheaply than smaller players, perhaps because “systemically important” institutions are now subject to extra regulations, including the requirement that they set aside more capital.
While this is good news for taxpayers and the economy, financiers bitterly resent any constraints on their ability to gamble with other people’s money, and they are voting with their checkbooks. Financial tycoons loom large among the tiny group of wealthy families that is dominating campaign finance this election cycle — a group that overwhelmingly supports Republicans. Hedge funds used to give the majority of their contributions to Democrats, but since 2010 they have flipped almost totally to the G.O.P.
As I said, this lopsided giving is an indication that Wall Street insiders take Democratic pledges to crack down on bankers’ excesses seriously. And it also means that a victorious Democrat wouldn’t owe much to the financial industry.
If a Democrat does win, does it matter much which one it is? Probably not. Any Democrat is likely to retain the financial reforms of 2010, and seek to stiffen them where possible. But major new reforms will be blocked until and unless Democrats regain control of both houses of Congress, which isn’t likely to happen for a long time.
In other words, while there are some differences in financial policy between Mrs. Clinton and Mr. Sanders, as a practical matter they’re trivial compared with the yawning gulf with Republicans.
By: Paul Krugman, Op-Ed Columnist, The New York Times, October 16, 2015
“Why Clinton’s Debate Dominance May Change The 2016 Race”: A Timely Reminder Of Just How Formidable Clinton Really Is
Even Hillary Clinton’s most ardent supporters would concede the last few months have not gone according to plan. Relentless media criticism, coupled with a surge of excitement surrounding Bernie Sanders and his progressive agenda, have weakened Clinton’s standing as the campaign has unfolded.
But just as importantly, it’s shaken Democrats’ confidence. To be sure, Democratic insiders and loyalists are an easily panicked bunch, but in recent months, certainty over the strength of Clinton’s candidacy evolved into doubt – a dynamic that created a vulnerability that has nearly lured Vice President Biden into the race.
With this in mind, Hillary Clinton not only dominated last night’s debate in Las Vegas, it arguably changed the direction of the race.
Going into last night, the former Secretary of State was confronted with headwinds: Clinton was perceived as the faltering frontrunner, burdened by a “scandal” no one can identify. Over the course of two impressive hours, however, Clinton emerged as a sure-footed, quick-witted, presidential-level powerhouse.
There’s simply no credible way Biden or any of his boosters watched the debate and saw an opportunity for the V.P. to seize. For that matter, Republican officials, increasingly confident about their general-election odds, received a timely reminder of just how formidable Clinton really is.
The intra-party argument over debates also took a turn last night. For months, a variety of Democratic insiders and candidates have complained that the DNC has scheduled too few debates, probably in the hopes of shielding the frontrunner. Last night turned the whole argument on its head – Clinton is easily the best debater, in either party, running in this cycle.
I was generally sympathetic to the Clinton campaign’s strategy – likely nominees always want fewer debates – but if I were her campaign manager, I’d start exploring the possibility of scheduling as many of these events as humanly possible. A one-debate-per-day plan through the fall of 2016 would probably be beneficial.
Indeed, it’s hard to imagine how last night could have gone much better for Clinton. She effectively went on the offensive over guns; she adeptly used President Obama to inoculate herself against criticism of her 2002 Iraq vote; she crushed a question about big government by slamming Republicans on reproductive rights; and she even turned a comment about a bathroom break into a charming moment.
And what of the emails? Clinton knew the question was coming, and she took full advantage of the opportunity Republicans created for her.
“I’ve taken responsibility for it. I did say it was a mistake. What I did was allowed by the State Department, but it wasn’t the best choice. And I have been as transparent as I know to be, turning over 55,000 pages of my e-mails, asking that they be made public. And you’re right. I am going to be testifying. I’ve been asking to testify for some time and to do it in public, which was not originally agreed to.
“But let’s just take a minute here and point out that this committee is basically an arm of the Republican National Committee. It is a partisan vehicle, as admitted by the House Republican majority leader, Mr. McCarthy, to drive down my poll numbers. Big surprise. And that’s what they have attempted to do.
“I am still standing.”
As effective as this was, moments later, Bernie Sanders brought down the house with this memorable line: “Let me say something that may not be great politics. But I think the secretary is right, and that is that the American people are sick and tired of hearing about your damn emails.”
The entire “controversy,” such as it was, unraveled before our eyes into a manufactured, partisan, faux-scandal.
As for the bigger picture, Republicans must have been discouraged by Clinton’s strong showing, but I hope they also noticed how much better last night’s debate was than anything the GOP candidates have shown in their events. On every front, the exchanges in Las Vegas showed Democratic candidates better prepared, more substantive, and more knowledgeable than their far-right counterparts.
During the debate, Politico’s Glenn Thrush noted on Twitter, “The level of discourse – nuance of discussion – compared to the GOP debates? Not even close.” The Washington Post’s Dave Weigel added soon after, “[W]atching this debate after slogging through all the Trump debates is like moving from kindergarten into grad school.”
Hillary Clinton won big last night. Republicans lost.
By; Steve Benen, The Maddow Blog, October 14, 2015
“Revenge Of The Conservative Pragmatists?”: Willing To Save The GOP From Itself By Doing Common Sense Constructive Things
Even as the uncertainty around who will succeed John Boehner as Speaker of the House seemed to grow murkier today, there was also a rare sighting of governing amid all the chaos.
Democrats announced at a press conference today that 218 House members have signed a discharge petition to force a vote to reauthorize the Export-Import Bank. Discharge petitions are very rare — the last one that worked came in 2002, forcing a vote on campaign finance legislation some 13 years ago.
The Ex-Im Bank finances deals involving American exports, and its supporters say it is crucial in helping American companies compete with companies abroad for contracts and thus in sustaining U.S. jobs. But it has been a longtime target of conservatives who discern “crony capitalism” afoot.
At the presser today, Nancy Pelosi said:
“This is a very important day, because we have broken through the wall of obstruction in the Congress to get the job done in a bipartisan way. Which is what we all come here to do.”
And Democratic whip Steny Hoyer said:
“What today showed was, when people are allowed to express their will, we had 42 Republicans sign a discharge petition.”
What Pelosi and Hoyer are saying is that the success of today’s discharge petition shows that it is possible for a bipartisan coalition to come together on something if a way can be found to get around the GOP leadership’s refusal to hold a vote on it.
Now, we don’t know if Ex-Im will actually get reauthorized. Senate GOP leader Mitch McConnell is already dumping cold water on the possibility of it getting to the Senate floor. But the question today’s discharge petition raises is whether it could be used to bring together a bipartisan coalition on other things that conservatives will insist that GOP leaders prevent votes upon.
“This suggests another way to go about this,” congressional scholar Norm Ornstein tells me. “If you end up with leaders who refuse to bring things to the floor that would pass with a lot of Democrats and that some Republicans want, make the discharge petition a regular tool. Don’t just do it once.”
Ornstein says that many of the House Republicans who signed the discharge petition aren’t necessarily moderates, which are a rarity in today’s GOP, but are better described as “conservative pragmatists.” Ornstein argues that, theoretically at least, many of these Republicans might be willing to sign discharge petitions to accomplish things like more funding for infrastructure and even lifting the debt limit, getting around a protracted standoff that GOP leaders might feel constrained to pursue to prove to conservatives that they are “fighting.”
The question would be whether Republican moderates would be willing to repeatedly defy the leadership, as well as conservatives activists and voters. “How willing are they going to be to say, ‘we’re going to save our party from itself by doing common sense things that are constructive, even if the crazy people say they don’t like it’?” Ornstein says.
All of this of course seems very far fetched. So do other solutions that would require breaking out of partisan patterns, such as Brian Beutler’s suggestion of the election of a coalition Speaker who, supported by Democrats and Republicans, would not have to live in fear of the House Freedom Caucus. But in a way that’s the point: Anything that is going to achieve results seems far fetched right now. Which means everything is worth trying.
By: Greg Sargent, The Plum Line, The Washington Post, October 9, 2015
“Pope Francis Will Not Help Your Political Cause”: Even The Pope Can’t Change The Fundamental Calculus Of Congress
“Pope Francis gets political in remarks at White House,” read the headline at The Hill.
“Pope Francis brings political agenda to Washington,” said Politico.
“Pope Francis wades into U.S. politics,” read The Washington Post.
Seeing all that, you might think that the pontiff had said, “Blessed are the peacemakers, and also, call your representatives and tell them to vote yes on H.R. 2451…”
Meanwhile, countless interest groups are sending out press releases saying the pope agrees with them on their issue of concern (the dumbest I’ve seen has to be the 30-page report from a Democratic group charging that the Koch brothers are “on the wrong side of the Holy Father”). But I have some bad news if you were hoping the pope would aid your particular partisan cause, whatever it is: The pope’s visit is not going to matter much.
I suppose you can’t blame the political press for interpreting the pope’s trip through the lens of politics, since it’s their job to view everything through the lens of politics. And it’s true that the pope is visiting the White House and giving an address before a joint session of Congress while he’s here. But is he really going to change the nature of any of the serious partisan arguments we have?
It’s not too likely, because no matter how popular Francis might be, nobody here is just going to do what he says on any issue just because he’s the pope. It’s strange now to look back at the 1960 campaign and see that people were genuinely concerned that John F. Kennedy would be taking orders from the Vatican instead of doing whatever he thought was best. We’d never accuse a Catholic presidential candidate of that today, less because it would sound intolerant than because it would sound ridiculous. When ordinary Catholics don’t take orders from the pope, why would a Catholic president?
Catholics have a lot of practice at picking the Church edicts they want to obey and those they don’t — and that applies to both liberals and conservatives. The conservatives take all that stuff about helping the poor with a grain of salt, while the liberals have decided to agree to disagree with the Church on matters like same-sex marriage. And most everybody disagrees with the Church on birth control; in this Pew poll, three-quarters of Catholics said the Church should permit contraception, and the overwhelming majority of Catholic women of childbearing age use it.
Of course, this isn’t just about obedience, it’s also about the pope’s ability to add his voice and moral authority to political questions. You could argue that when the pope talks about climate change, he makes concern about it seem like a mainstream position and not the province of lefties and liberals. Which is true as far as it goes, but in the U.S. today, that isn’t that far. In the intensely polarized environment in which we live, even a highly popular religious figure can’t change the fundamental calculus of Congress.
One of our two great parties has committed itself to fight any moves that might address climate change, a commitment that is unlikely to change any time soon. That’s true despite the fact that most of their own constituents believe we ought to do something about it. The dynamics of party politics mean that the Republicans who actually get elected are going to be the ones who are most doctrinaire, on this as on most issues. That means that as long as they control Congress, there will be enough of them to stop any climate legislation, which in turn means that action will only come through the kind of regulatory changes that the Obama administration has instituted. The only thing that will produce meaningful climate legislation is huge Democratic majorities in Congress of the kind they had briefly at the start of Barack Obama’s first term. Might there be a Republican member of Congress somewhere who wishes she could publicly advocate reductions in greenhouse gases, and will finally have the courage to do so now that she can claim Pope Francis as an ally? I suppose it’s possible, but I wouldn’t bet on it — let alone there being some significant number of Republicans who would join her.
The same is true of other issues: the more something matters to us politically, the less the pope is able to change anyone’s mind here in the United States, whether he’s talking about abortion or refugees or tax policy.
Even if some conservative media outlets are now going after Francis like he was Hillary Clinton because of what he’s said about climate and capitalism, they needn’t worry so much. While everyone is parsing the pope’s words to see if he supports their position on something or other — he said he’s an immigrant, so he must be criticizing Donald Trump! He said we need religious liberty, so he must be backing Kim Davis in Kentucky! — what will come out of this visit is a lot of selfies, a lot of media puff pieces, and probably a jump in the pope’s popularity. But politically, everything will stay just the same.
By: Paul Waldman, Senior Writer, The American Prospect; Contributor, The Week, September 24, 2015
“It’s Hogwash, But People Never Seem To Learn”: The Outsider Delusion And The Fallacy Of ‘Getting Things Done’
As you will read in a hundred news stories over the next few weeks, the outsider’s moment in the presidential campaign has arrived. This is going to be the prevailing narrative of the 2016 race, until a new one comes along. It’s perfectly accurate (for now, anyway), but we should ask just what voters are seeking when they gravitate to outsiders, and what they’re likely to get.
First, the latest numbers. A new Marist/NBC News poll of Iowa and New Hampshire shows Donald Trump holding a healthy lead in both states, with Ben Carson coming in a strong second in Iowa and third in New Hampshire; Carson’s rise is not quite as entertaining as the Trump campaign, but it’s nearly as significant. Meanwhile, Bernie Sanders has cut into Hillary Clinton’s lead in Iowa and moved ahead of her in New Hampshire, where the race between the two has been closer for some time now. And a new Economist/YouGov poll shows Trump moving even farther ahead nationally, with his support at 36 percent, followed by Carson at 11 percent.
Most reporters have decided, based not just on poll numbers but also on their conversations with voters and the evidence they gather on the trail, that the state of the race can be explained by the American people’s dissatisfaction with “politics as usual.” Fed up with Washington’s gridlock and its inability to solve big problems, voters turn to outsiders who promise to do things like “shake up the system” and “change the way Washington does business.” These candidates supposedly possess fresh ideas and new perspectives that can turn everything around.
It’s hogwash. But people never seem to learn.
On the Democratic side, you can at least make a reasonable case for Bernie Sanders’ brand of outsiderism. Sanders is no political neophyte — he has held public office for most of the past 35 years, which gives him an insider’s understanding of how the system works. And his argument is a focused one, centered on the influence of big money and how it helps produce and sustain inequality. While tackling that problem is extremely difficult, one could at least imagine a President Sanders making some progress on it.
On the Republican side though, the two leading outsiders, Trump and Carson, have nothing so specific in mind. They argue that they’ll get things done, Trump through the force of his will, and Carson because he is untainted by politics. Ask either one of them about a specific policy issue, and it quickly becomes clear that when it comes to the issues a president deals with, they’re utter ignoramuses, which is perhaps understandable, if less than reassuring. I’m sure Marco Rubio doesn’t know much about brain surgery, which Carson knows a great deal about, but he’s not running for Brain Surgeon in Chief.
If you’re a voter attracted to these outsiders, you’d do well to ask yourself: What, precisely, will an outsider do as president that an insider wouldn’t? Would they pursue a fundamentally different set of policies? Not likely — the policies they’ll pursue will by and large be those of their party. Ben Carson may be a political newcomer, but the policy positions he takes are essentially the same as those of the other Republicans. And any Republican will appoint most of the same people to the thousands of executive branch positions. When it’s out of power, each party maintains what is essentially an executive branch in exile, spread among Washington think tanks and advocacy organizations, waiting to move back into government. It isn’t as though the outsider candidate can fill these positions from somewhere else.
And when it comes to things like government gridlock, you have to ask the question again: What is the outsider candidate going to do differently? Outsiders talk about things like “shaking up the system” and “changing the way Washington does business,” but they seldom get too specific about what those things might mean in practice. What would a shaken-up system look like? For instance, would it mean that Congress would swiftly and efficiently pass a bunch of bills instead of being consumed by bickering?
If that’s your idea of what the system ought to produce, then electing an outsider president isn’t the way to do it. The way to do it is to give one party control of Congress and the White House, preferably with at least 60 votes in the Senate to overcome filibusters. Then you’ll see the system work.
President Obama had that for a time in his first term, and Congress was extremely productive, passing a large economic stimulus, financial reform, health-care reform and a bunch of other stuff you’ve probably forgotten about by now. If you don’t remember that period as one in which the system worked the way it’s supposed to, it’s probably because you didn’t like the particular things Washington accomplished. The real problem you had wasn’t with how smoothly the system operated, but with the substance of what it produced. In fact, Republicans often complain that the Affordable Care Act was “rammed down our throats” — in other words, they think the legislation wasn’t mired in gridlock for long enough (the fact that on Planet Earth it actually passed after more than a year of hearings, debates and negotiations isn’t really the point).
Plenty of voters say they want to get beyond partisanship and just find someone who’ll “get things done,” but that’s not what they really want. Everyone has an agenda. They want some things to get done, but not others. No conservative looked at Obama’s first two years and said, “I don’t like his policies, but I do admire the fact that he’s getting things done, so I’d like him to keep going in the same direction.” When George W. Bush tried and failed to privatize Social Security, no liberal said, “I’m disappointed that he wasn’t able to get things done.”
It’s perfectly understandable that Republicans are attracted to outsiders at this particular moment in history. As I’ve noted before, the real source of discontent among GOP voters with their party’s leaders is less about the rift between the establishment and the tea party than it is about the belief that the party’s leaders are ineffectual. They keep promising their constituents that they’ll destroy Barack Obama, repeal the Affordable Care Act and cut government down to size, but they never deliver. So when someone like Trump comes along and says he’ll sweep aside every problem and make all their dreams come true, it’s quite compelling, no matter how removed it is from reality.
But the truth is that voters of any persuasion don’t want to shake up the system when it isn’t getting things done; they want to shake it up when it isn’t doing the particular things they want. Washington may not be working, but what we really care about is whether it’s working for us.
By:Paul Waldman, Senior Writer, The American Prospect; Contributor, The Plum Line Blog, The Washington Post, September 7, 2015
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