When Banks Write Government Legislation, It’s Time To Kill The Banks … And The Government

25 May

From the New York Times:

WASHINGTON — Bank lobbyists are not leaving it to lawmakers to draft legislation that softens financial regulations. Instead, the lobbyists are helping to write it themselves.

One bill that sailed through the House Financial Services Committee this month — over the objections of the Treasury Department — was essentially Citigroup’s, according to e-mails reviewed by The New York Times. The bill would exempt broad swathes of trades from new regulation.

In a sign of Wall Street’s resurgent influence in Washington, Citigroup’s recommendations were reflected in more than 70 lines of the House committee’s 85-line bill. Two crucial paragraphs, prepared by Citigroup in conjunction with other Wall Street banks, were copied nearly word for word. (Lawmakers changed two words to make them plural.)

The lobbying campaign shows how, three years after Congress passed the most comprehensive overhaul of regulation since the Depression, Wall Street is finding Washington a friendlier place.

The cordial relations now include a growing number of Democrats in both the House and the Senate, whose support the banks need if they want to roll back parts of the 2010 financial overhaul, known as Dodd-Frank.

This legislative push is a second front, with Wall Street’s other battle being waged against regulators who are drafting detailed rules allowing them to enforce the law.

And as its lobbying campaign steps up, the financial industry has doubled its already considerable giving to political causes. The lawmakers who this month supported the bills championed by Wall Street received twice as much in contributions from financial institutions compared with those who opposed them, according to an analysis of campaign finance records performed by MapLight, a nonprofit group.

The passage of the Dodd-Frank Act, which took aim at culprits of the financial crisis like lax mortgage lending and the $700 trillion derivatives market, ushered in a new phase of Wall Street lobbying. Over the last three years, bank lobbyists have blitzed the regulatory agencies writing rules under Dodd-Frank, chipping away at some regulations.

But the industry lobbyists also realized that Congress can play a critical role in the campaign to mute Dodd-Frank.

The House Financial Services Committee has been a natural target. Not only is it controlled by Republicans, who had opposed Dodd-Frank, but freshmen lawmakers are often appointed to the unusually large committee because it is seen as a helpful base from which they can raise campaign funds.

For Wall Street, the committee is a place to push back against Dodd-Frank. When banks and other corporations, for example, feared that regulators would demand new scrutiny of derivatives trades, they appealed to the committee. At the time, regulators were completing Dodd-Frank’s overhaul of derivatives, contracts that allow companies to either speculate in the markets or protect against risk. Derivatives had pushed the insurance giant American International Group to the brink of collapse in 2008. The question was whether regulators would exempt certain in-house derivatives trades between affiliates of big banks.

As the House committee was drafting a bill that would force regulators to exempt many such trades, corporate lawyers like Michael Bopp weighed in with their suggested changes, according to e-mails reviewed by The Times. At one point, when a House aide sent a potential compromise to Mr. Bopp, he replied with additional tweaks.

Ultimately, the committee inserted every word of Mr. Bopp’s suggestion into a 2012 version of the bill that passed the House, save for a slight change in phrasing…

Citigroup and other major banks used a similar approach on another derivatives bill. Under Dodd-Frank, banks must push some derivatives trading into separate units that are not backed by the government’s insurance fund. The goal was to isolate this risky trading.

The provision exempted many derivatives from the requirement, but some Republicans proposed striking the so-called push out provision altogether. After objections were raised about the Republican plan, Citigroup lobbyists sent around the bank’s own compromise proposal that simply exempted a wider array of derivatives. That recommendation, put forth in late 2011, was largely part of the bill approved by the House committee on May 7 and is now pending before both the Senate and the House.

[Full article here]

One wonders how similarly “helped” our local lawmakers are.

The final word goes to UK Independent Party politician, Nigel Farage –

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6 Responses to “When Banks Write Government Legislation, It’s Time To Kill The Banks … And The Government”

  1. mick May 25, 2013 at 1:01 pm #

    Not just banks are writing their own legislation. All big business attempting to rort the system. It is a sign of bad things continuing to come when lawmakers do not employ the public service to do this for them. So what is the huge public service doing? Writing propaganda papers?

  2. Kevin Moore May 25, 2013 at 1:27 pm #

    “Thus all the nations will be swallowed up in the pursuit of gain and in the race for it will not take note of their common foe……”

    The protocols tell us where we have gone astray –

    Protocol 4 “…Who and what is in a position to overthrow an invisible force? And this is precisely what our force is. Gentile masonry, blindly serves as a screen for us and our objects, but the plan of action of our force, even its very abiding place, remains for the whole people an unknown mystery.

    But even freedom might be harmless and have its place in the State economy without injury to the well being of the peoples if it rested upon the foundation of faith in God, upon the brotherhood of humanity, unconnected with the conception of equality, which is negatived by the very laws of creation, for they have established subordination.

    With such faith as this a people may be governed by a wardship of parishes, and would walk contentedly and humbly under the guiding hand of its spiritual pastor submitting to the dispositions of God upon Earth.

    This is the reason why it is indispensable for us to undermine all faith, to tear out of the minds of the goyim the very principle of Godhead, and the spirit, and to put in its place arithmetical calculations and material needs.

    In order to give the goyim no time to think and take note, their minds must be diverted towards industry and trade. Thus all the nations will be swallowed up in the pursuit of gain and in the race for it will not take note of their common foe……”

    Revelation 18:4 “And I heard another voice out of heaven saying, My people, come out of her, that you may not share in her sins, and that you not receive of her plagues”

  3. egeo veritas May 25, 2013 at 9:55 pm #

    We must not forget to read the protocols, as the Agenda for the 21st is nearly complete. Let’s upset their plans & VOTE a big fat NO!!! At the coming referendum election.
    A yes! will facilitate a Global derivative GHG gases trading market audited by your LGA & with their new found Government recognition all those UN ICLEI C40 agreements can be implemented. Wow! A new form of funding bypassing the sovereignty of the people. Don’t look too hard or you will find the finger prints of GS all the way from the Aus Committee members through C Quest & WB. Many more on this scam.

  4. Richo May 27, 2013 at 10:33 am #

    BI,
    Have you heard of peer to peer finance? It was featured on the ABC’s Checkout recently.
    Very interesting. Silver bullet??

    “Borrowing money from strangers”

    http://www.abc.net.au/tv/thecheckout/clips/

    • The Blissful Ignoramus May 27, 2013 at 7:28 pm #

      Yes I have Richo. I’m not a fan though. While I support decentralisation as a general principle, I see P2P lending of money as merely serving to decentralise what is essentially a predatory action (lending for profit/usury).

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