Saturday, February 14, 2015

191.5 - The little Thing: "Wall Street- and business-friendly" equals "moderate"

The little Thing: "Wall Street- and business-friendly" equals "moderate"

Our next case of The little Thing starts with the reminder that a couple of shows ago I called it Good News when a Congressional revolt led by Elizabeth Warren succeded in blocking the nomination of yet another Wall Street banker, Antonio Weiss, to a spot at the Treauty Department.

In a rundown on the politics of the whole thing, said this:
It was not a total victory. Weiss will still join Treasury as an unconfirmed counselor to Secretary Jack Lew. But in terms of symbolism, the Washington power game and the ideological direction of the Democratic Party, Warren won big. And the moderate, Wall Street- and business-friendly wing of the party - in past years happily occupied by Democratic presidential nominee-in-waiting Hillary Clinton - got punched in the mouth.
Did you catch that? The "Wall Street- and business-friendly wing" among Dimcrats is defined as the "moderates." To be for Wall Street is to be a "moderate." Which means by definition, then, that to be for consumers, to be for workers, actually to be for "the little guy" that everyone claims to for, well that makes you some kind of a radical.

Let me tell you about these "moderates."

The 2010 Dodd-Frank financial reform act included a provision called the "push-out rule." That rule says, essentially, that if banks and financial houses want to engage in risky trading in derivatives, they have to do it through separate non-bank affiliates that aren't insured by the FDIC and are less likely to receive government bailouts.

Banks, especially the Big Five of Citigroup, JPMorgan Chase, Goldman Sachs, Bank of America, and Wells Fargo, which together control 90% of the derivatives market, they of course hate the rule because they want to - again - gamble with taxpayer-backed money, confident they'll be bailed out - again - when it all blows up in their faces - again.

Well, the continuing resolution that the lame-duck Congress passed in December to keep the government funded not only included a provision that eviscerates the push-out rule, it does so in language that was written by lobbyists for Citigroup.

Don't believe me? Check the side-by-side comparison. On the left is the Citigroup draft of the involved section, on the right is the actual legislation. The colored sections are word-for-word identical.

An attempt was made to remove the provision from the final bill. It failed because those "moderate Democrats" weren't willing to challenge the party's big donors from Wall Street.

Face facts: These people, these "moderates" of the Democratic party, are not on your side. When they say they are, they are lying to you.

Sources cited in links:

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