Wall Street Bank Lobby Faces 'Live Ammo' As Lawmakers Ponder Breaking Up Big Banks

bloomberg.com:

Nov. 12 (Bloomberg) -- Seven Wall Street lobbyists trooped to Capitol Hill on Nov. 9, hoping to convince Representative Paul Kanjorski's staff that his plan to dismantle large financial firms was a bad idea.

They walked out with a sobering conclusion, according to the accounts of two attendees who requested anonymity because the meeting was private. Not only was Kanjorski serious, he planned to offer the legislation as early as next week -- and it just might pass.

Read the whole story: bloomberg.com

Comments

[World Citizen]

AND GET THIS : "“In fact, you couldn’t have had the assisted takeovers you had,” Gramm, now a vice chairman at the investment bank division of UBS AG, Switzerland’s biggest bank by assets, said in a Nov. 10 telephone interview. “More institutions would have failed.”

I have never heard of a better non-sequitur than Gramm's response : "In fact, you couldn’t have had the assisted takeovers you had".

There wouldn't be a NEED FOR ASSISTED TAKEOVERS if Glass-Steagall was not repealed !!!

Gramm was the chairman of the U.S. Senate Committee on Banking, Housing, and Urban Affairs. During that time he spearheaded efforts to pass banking deregulation laws, including the landmark Gramm-Leach-Bliley Act in 1999, which removed Depression-era laws separating banking, insurance and brokerage activities.

Gramm joined UBS in 2002 immediately after retiring from the Senate. He is now a Vice chairman at the investment bank division of UBS AG !

Please Mr. Gramm, it would seem that you use your position to spearhead banking deregulation and then make a cushy job for yourself in the banking industry. I normally do not go down to name calling. But, you are a weasel !

[Graz]

Most sickening quote in that article; “I’ve never seen any evidence to substantiate any claim that this current financial crisis had anything to do with Gramm-Leach-Bliley.” - Phil Gramm

[DemocratCongress]

yaawn break better news, puffingt0n poopost

good articles; http://financeopinionss.blogspot.com

[DemocratCongress]

yaawn break better news, poo puff

good articles; http://financeopinionss.blogspot.com

[aflyinyoursoup]

Oh yeah.....This is gonna happen.....Uh Huh......

[JavaManiac]

Break them up - the competition will be good for them. As it is they all sit up there worrying about how to stiff the client rather than how to win customers and stay in business.

[DosGatos2]

The banksters have had real difficulty putting lipstick on this particular pig because the facts are so stark, even the ignorant can understand them.

For years, banksters have preached the virtues of unfettered free-market capitalism. They dressed up a flawed economic theory "trickle down economics" to justify their taking most of the wealth generated by the American workforce in the past 20 years. They took nibble after nibble of the wealth of this country, and were able to justify each bite.

But the bank failures are different--there are too few banks, they are too interconnected, they do not compete fairly as they should, and they are not doing the job for which they were bailed out--lending money. And they most definitely do not want to accept the consequences of free-market capitalism.

True, Silver Spring Community Bank cannot handle the business of an IBM, but there is no reason that big banks have to have consumer operations so that they can gamble with tax-payer money either.

I hope the banks are broken up and we enact a new Glass-Steagall. The public is not forgetting this time because they see the effects in their daily lives and see things worsening for the average person. Funny thing is both sides of the political spectrum seem to agree on "too big to fail".

GO KANJORSKI!!

[Shwazy]

I'll believe it when I see it.

There is no way the moneyed interests that control campaign finance are going to let such a thing happen. It will be successfully lobbied against with a combination of hefty campaign contributions, propaganda directed at the public, and delay/obfuscation tactics.

Mark my words, it will never pass. Those who control our economy won't allow it.

[drkazmd65]

Never say never Shwazy,... but I agree that such legislation faces an uphill slog,... and will likely be watered down with numerous amendments before it were to hit the books.

[Emerald1943]

Fanned! You beat me to the keyboard! I was about to express the very same opinion! Until we have sweeping CAMPAIGN FINANCE REFORM, we will see very little, if any substantial legislation that benefits the American working people over the corporations.

[jrutle]

Campaign finance reform is important but needs to take place as part of a larger effort to curb the power and influence of corporate lobbies operating anywhere within the Washington beltway. We've lived in a gilded age of capitalism for a number of years now and have become too accustomed to the fact that corporate interests prevail over the public interests in the legislation that is passed and in the way the regulators choose to enforce their authorities.

[alreadybad]

It will pass. I see no problem in continuing to replace all elected representatives until we do. The 2010 elections will speak volumes and the representatives left, well, they'd better be listening.

[vippy]

To simply switch parties won't do anything at all. Both parties got us into this mess.
The DEMS were especially famous for giving GWB everything he ever wanted. We looked for change with Obama but either he has been bought, too, or he has no power!
Either way, we need to send a strong message and vote for a third party! Perhaps then we get someone to listen to us!

[niblik]

I vote that we stay engaged and pressure our elected officials to pass it. Nothing will be served by just giving up.

[lightningbolt]

Public outrage is starting to bear fruit. We must continue to be outraged and turn up the heat on the government to break up the banks and reinstate Glass-Steagall.

[jrutle]

Agree - its only through public outrage that Congress will be moved to pass the type of reforms that are required.

[protagonia]

Agreed!

[joebaggadonuts]

We can do better than Glass Steagall. We can put teeth into it and force a change in the Antitrust laws to dismember the bankster companies, with criminal penalties for antisocial/pathological finance. For example, we could say that a company cannot buy one larger than itself if the resulting entity is overburdened with debt. The economists can figure out just exactly how burdened is overburdened, but it is a good rule, kinda like a speed limit. Criminal behavior does not require mens rea ( http://en.wikipedia.org/wiki/Mens_rea ) for speeding to be punished, likewise, overburdening the resulting corporate entity should be a criminal thing.

[TopJack]

President Emanuel may not like this. And what he says, goes.

[jrutle]

Its good to see Congress finally starting to address the problems that created last year's financial meltdown. "Too big to fail" is but one part of a much bigger problem, though. Much more needs to be done to eliminate the root causes of excessive credit creation and separation of profit-taking from risk that has been at the center of a series of financial bubbles dating back to the 1980s. Another shock like last year's financial collapse will throw the economy into a deep depression.

[Emerald1943]

There have already been some dire predictions concerning the commercial real estate market's possible impending collapse which will be the proverbial straw that breaks the camel's back. We can't take much more.

[jrutle]

I agree. Wall St.'s bad behavior on financial derivatives is remanifesting itself again and the next bubble is right around the corner if Congress and the Administration don't act quickly and boldly to stop it.

[mivogo]

I agree. Here in New York, "too big to fail" Mayor Bloomberg just bought himself a third term, and the "too big to fail" Yankees bought themselves a World Series. They have corrupted politics and sports, respectively, but there is a major difference between them and the "too big to fail" banks--the former two take their own losses for their risks.

The banks don't. They risk our mortgage money, and when we bail them out from potential bankruptcy, what do they do? Jack up our credit card rates to obscene levels and put us into it!

Not only should the banks be broken up, but all Congresspeople who voted for credit card reform, then gave the banks time to obscenely jack up rates, should be voted out of office.

[Organic-Guy]

We need to separate banking from investing and break up all the cozy relationships on wall street before a bank or hedge fund or investment house gets close to failure not before. an ounce of prevention is worth a pound of cure as they say in medicine and it's true.
All of these banks and businesses need to be separate and be in competition with one another as capitalism requires and they all need to play by the same rules without special treatment for one business or industry over another. What we have no is a corpocracy supported by a corporate welfare state.

[vippy]

LOL, what exactly does it take before people wake up that voting for one or the other party is not going to do us any good? Throw out the bums period and vote 3rd party.

[DemocratCongress]

Can congress & Obama stop the backpedaling on wall street compensation?

good articles; http://financeopinionss.blogspot.com

where is the reform?

[hellboundtrain]

To say that it is too big to fail, is a certain misnomer, instead, accounting entries must be made that show that funds will go from one group of people that previously thought that they had certain protections that allowed their "system" to make fiat dollars based on an ethereal and vaporous definition of value. So it is not failing, it is showing a true definition of what has been allowed to occur in the absence of regulations that had set a workable boundary prior to their suspension. It is a re-defining of the workable.

"The U.S. needs big financial firms to compete globally." said Nichols. Compete with what? Other financial firms that have also been allowed, encouraged to bend all of the rules so that they can also manifest mythically large amounts based on what? An ethereal, vaporous concoction of value that is actually a mirage! Reset reality!

[autumncolors]

will we get any meaningful reform with the lobbyists entrenched in DC?

[jrutle]

Excellent question. The unchecked power and influence of corporate lobbies lies at the heart of crony capitalism that has corrupted national decisionmaking. Its a good sign that Congress is finally starting to act to curb the excesses of last year's financial meltdown, however.