After Democrats tried for three days in a row to break a filibuster from the GOP over financial reform, Senate GOP leaders finally folded on a filibuster for now -- facing the pressure of an unusually determined Democratic leadership eager to paint Republicans as friends of Wall Street. Despite the Obama economic team's closeness to Wall Street leaders and especially Goldman Sachs, and relatively weak reform bills that passed House and Senate committees, the political chances of reform have been boosted in the last week or so.
What's still up in the air is how meaningful any reform package needing a few Republican votes will be -- and whether there are enough votes for amendments to strengthen current bills breaking up too big to fail institutions, co-sponsored by Sen. Ted Kaufman (D-Del.) by setting asset limits and another measure, co--sponsored by Sen. Jeff Merkley of Oregon, to bar financial institutions from "proprietary trading" from its own accounts or betting against its clients investments. At this point, neither the Democratic leadership nor the Obama administration appear to favor those tougher amendments, but Majority Leader Harry Reid has indicated he'll allow floor amendments to be offered.
Progressives can thank the grilling of the firm's executives at a Senate hearing Tuesday and the alleged wrongdoing of Goldman Sachs for much of the new outrage and momentum behind reform. The thousands of protesters expected to converge on Wall Street today, supported by labor unions, the 200-group Americans for Financial Reform and organized by National People's Action, have a new focus for their anger. The SEC's civil lawsuit over fraud filed against Goldman Sachs for hoodwinking investors laid bare the machinations of the firm in packaging sure-to-fail securities for one hedge fund investor betting on the collapse of the housing market -- and then selling the same product to other investors as a gateway to riches. But the arrogant, we-did-nothing-wrong testimony of CEO Lloyd Blankfein and his henchmen helped make the case for reform better than political speeches by President Obama.
As the Washington Post's Dana Milbank observes:
Lawmakers have been haggling over financial reform for 18 months, but it took Goldman Sachs just one day to get it done.
Of course, the Wall Street giant wasn't intending to get the financial legislation done. Quite the opposite: Like most in the investment world, Goldman would generally prefer that regulators leave it and its billions of dollars of profits alone. But when Goldman executives faced a Senate panel on Tuesday, their performance was so obnoxious, their contempt for lawmakers so palpable, that their appearance had the effect of dissolving the Republican resistance to what Democrats are now calling "Wall Street reform."
Sen. Carl Levin (D-Mich.), who chaired Tuesday's hearing, went to the Senate floor Wednesday morning to denounce the "extreme greed" of Goldman Sachs. "What we've got to do is build defenses against these kinds of excesses," he urged.
Both Republicans and Democrats took turns lambasting the Goldman Sachs executives who figuratively thumbed their noses at Congress. But Republicans continued to block votes on financial reform until Wednesday, and offered their own Wall Street-friendly alternative bill this week that was dismissed by leaders with Americans for Financial Reform as an "insult" and a joke. As Heather Booth told In These Times by email:
They give consumer protection to the very regulators who got us into this mess with no one solely focused on consumer protection.
They create loopholes for the casino economy that leave us open to risky bets without transparency or money to back them up--that got us into this crisis
They don't have a process for dismantling or liquidating the firms that are so big that they would jeopardize the economy--and we would be back where we were when the crisis began.
If they want a stronger bill, they should support Kaufman and Merkley. If they want any bill at all, they should vote to bring the bill to the floor for a vote and not for backroom deals.
Another source of pressure came from labor unions, with the AFL-CIO claiming it organized 400,000 workers to contact Republican Senators over financial reform.
Given the calamity caused by out-of-control financial firms,it's little wonder that activists will be converging on Wall Street, assembling near City Hall, with a clear, forceful message that they hope will be finally heard in a Congress. Unfortunately , Washington is still overrun by financial lobbyists busy carving out loopholes and an industry that's spent $500 million to defeat reform. It's in the fine print where Wall Street can win out - unless the titans of Wall Street are overruled by the voices of Main Street:
Wall Street's Time is Up:
National People's Action issues a Call to Action for everyday people--small business owners and union members, homeowners and tenants, faith leaders, the employed and the unemployed--to join together in recognition of our shared fate and our commitment to democracy.
Today at 3:30pm ET, thousands will converge on Wall Street to reclaim America with one simple message: Americans deserve an economy that works for all of us, not just Wall Street!
Wall Street and big banks like Bank of America and Wells Fargo crashed our economy leaving millions without housing, work, and critical services.
Yet it's not at all clear how much populist energy President Obama will be able rally as for real, as opposed to cosmetic, financial reform. As David Corn of Mother Jones notes:
Last week, President Barack Obama gave a speech in New York and decried Republican lawmakers for making false accusations about the Wall Street reform pending in the Senate and denounced the "battalions of financial industry lobbyists descending on Capitol Hill" to weaken or kill the bill. But, as I noted, Obama "named no names. He did what too many politicians often do when they describe how special interests game Washington; he stayed vague." In pushing back against Republicans and Wall Streeters, Obama doesn't make it personal. He doesn't call out any particular foe of reform. Such reticence limits whatever populist energy he might be able to generate by fighting for financial regulation reform.
The march in Wall Street drew 10,000 people and strong demands for reform from leading union organizations, including SEIU and the AFL-CIO. Here's what SEIU reported:
Today, SEIU members joined thousands of clergy, workers, families, and community allies in a massive march through Wall Street to demand big banks act to stop foreclosures, promote job creation, and end predatory lending and abusive consumer practices. Families also demanded Wall Street stop spending millions fighting reform efforts in Congress.
"This week we saw Americans from across the country stand up and tell Wall Street CEOs that our families and communities refuse to continue to pay the price for Wall Street's recklessness," said Stephen Lerner, Director of SEIU's Banking and Finance Campaign. "We're tired of an economic system fueled by financial tricks that produce no goods, no jobs, and no social benefits. And we're tired of seeing Wall Street use their wealth to warp our democracy, buy politicians, and lock Main Street into recession."
Today's march was the latest in a series of mobilizations kicked off this week to rein in Wall Street's reckless practices and was the largest mobilization since 5,000 Americans converged on the American Bankers Association conference last fall.
The AFL-CIO also played a leading role in organizing the march, and proclaimed:
Over 10,000 people brought Main Street to Wall Street today in a march, led by the AFL-CIO and National People's Action (NPA). Wall Street tanked America's economy, killed jobs, took $700 billion in taxpayer bailouts - then went right back to business as usual, choking off credit, handing out $145 billion in 2009 executive pay and bonuses and fighting meaningful financial reform. We're 11 million jobs in the hole and it's time for the financial industry to pay up to create them. AFL-CIO President Richard Trumka and thousands of union and community activists from across the country rallied and marched down Broadway in the heart of the financial district on April 29 to demand GOOD JOBS NOW and HOLD BANKS ACCOUNTABLE.
Working families and community members mobilized one of the largest gathering ever organized against big banks, calling for accountability, job creation and an end to predatory lending practices from Wall Street institutions like Bank of America, JP Morgan Chase and Goldman Sachs.
The rally began in City Hall Park and followed by a march down to the Merrill Lynch Bull where AFL-CIO President Richard Trumka said, "People in New York and across the country, who did nothing wrong and want to work, have paid for the misdeeds of the big banks with their jobs, homes and retirement savings. Now it's time for our government to hold Wall Street accountable and make them pay to create the good jobs they destroyed."
This article originally appeared on the Working In These Times blog.
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