Greed Is Winning

If there is ONE thing that Democrats and Republicans should agree on—even if ONLY to align themselves with American sentiment, it is the issue of Wall Street reform.

An overwhelming majority of Americans are disgusted with the conduct of the Wall Street banks, which have traveled from the brink of extinction to taxpayer bailout to record profits in the course of a few short months. All of this while unemployment stays just under 10 percent and the economy struggles to recover from the near collapse caused largely by these same greedy capitalists.

Let’s face it-demonizing Wall Street—even if it isn’t entirely accurate—is good politics. Nobody likes these Armani suited, cigar smoking, limo-riding pigs whose only objective is to make as much money (in whatever manner possible). OK—is that not the truth? Perhaps it’s not universal, but the impression of the average American tends to gravitate to this image.

And the Republicans don’t get it. Again.

In another effort to thwart the President and re-cast measures to reform this broken system into being yet another example of Democrats attempting to place all things under governmental control, the Republicans have succeeded in using a legislative tactic to keep the proposed bill from even coming to the floor of the Senate for debate.

Huh?

This time around, playing politics with Wall Street reform may backfire for the Republicans, who stand to gain a bunch of seats in the mid-term elections coming off the distaste of many Americans over the passage of Health Care reform. Seems that any agreement with the Dems is seen as a sign of weakness—and a “scorched earth” approach is the only one warranted.

Bad decision.

Let’s go back to the Fall of 2008, when the spector of these Wall Street banks failing had the U.S. economy on the literal brink of collapse. At that time, both Democrats and Republicans voted to bail out the banks—and BOTH parties vowed that this could never happen again. To be clear, both parties promised significant new federal regulatory measures to keep private banks from engaging in ultra-risky behaviors.

No one argued about the need for more stringent regulations. It gave political cover for those whose votes to bailout the banks were, shall we say…..distasteful—at best.

So, what happened?

The banks cruise along their merry way, utilizing the American taxpayer to provide their golden parachute—and then proceed to generate record profits, all of this while small businesses still struggle to secure short-term credit.


Here’s a little clip from the 1987 movie “Wall Street” entitled “I Create Nothing..I Own”-yeah, it’s a movie, but the sentiment drives Wall Street behavior, I think. Michael Douglas’s character, Gordon Gekko—is a role model to those whose only goal is to get rich—quick:



http://www.youtube.com/watch?v=e9mWAxHpeew&feature=related


The Republicans argue that they were not included in the process, that it was not bi-partisan, just another attempt by the Democrats to exclude their input. Sounds fair on the surface, but Republicans failed to offer a SINGLE amendment to the bill (hey, guys, that’s the opportunity to have the input you crave) No, the GOP allows the bill to pass through committee and then KILLS it before it has a chance to come to the floor.

The reasons I have heard generally revolve around the following:

1) They want to eliminate the “too big to fail” provisions-blaming Democrats for bailouts that were truly bipartisan. OK, but the six LARGEST banks control over HALF of the U.S. GDP. Republicans are against invoking anti-trust logic to break up these banks into smaller entities, however, arguing that to do so would make these large banks globally uncompetitive. Seems a choice needs to be made. If breaking up these banks is not acceptable, then we must prop them up when they edge towards failure. Not doing this and allowing them to fail could have disastrous consequences. Their prior votes to bailout these banks prove they agree.
2) Republicans are against a “commission” to oversee Wall Street behavior. I may side with them on this one—as creating another entity-a separate bureaucracy—is against the fiber of my being. Here, too, was an opportunity to discuss/debate this in committee—or on the floor of the Senate. But they blew it.
3) There is a belief that more restrictive regulations will somehow hurt SMALL business. I just plain don’t understand this. Maybe I’m ignorant.

The huge infusion of cash into the campaign coffers of Congress members cannot be understated when looking for motives. The general strategy is to keep this legislation (which many Americans don’t fully comprehend as it is complex in nature)in the back rooms of Congress. Keep it away from the spotlight and the glare of media attention. Those Congress members who are essentially OWNED by Wall Street will then be able to insulate their inaction and/or their true motives from voters.

Much of what Wall Street engages in has nothing to do with creating jobs. Derivatives-their creation, their trading and sale to other banks and unsuspecting countries—have no socially redeeming value. Margin selling, short selling, betting on entire segments of the economy to fail (like the housing market)—and then CASHING in on that failure is at the heart of the problem.

No one wants more government regulation. However, ALL government regulation has its birth directly related to actual abuses in the private sector that created a reason to step in.

Perfect economic models always favor de-regulation.
The missing piece, however, is an assumption that all players in the game are not motivated solely by greed and efforts to skirt the edges of legality. The fact that corporations and banks will go to all lengths to increase profits—regardless of the consequences to anyone but shareholders—is all the reason we need to make sure that safeguards are in place.

The SEC is there to protect consumers who actively participate in the stock and bond markets. Without strict regulations, U.S. citizens would be routinely ripped off, misinformed about investments and would have no recourse to seek justice. No one argues the need for the SEC, not even Republicans, who park much of their wealth in the U.S. Stock Market.

But hey, it’s a GOVERNMENT BUREAUCRACY, no?

What caused the need to create the SEC has now extended to additional segments of the economy.
This spirit of consumer protection needs to extend to Wall Street, which collectively has no conscience and seeks only to further its own wealth.

This is a mission that needs a unified attack. Courageous Congressmen and women need to join forces. Those not in the pocket of Wall Street need to join—Republicans and Democrats. The mere exercise of doing this will expose those whose political survival has depended upon the wicked motives of Wall Street banks. These politicians need to be shamed into either siding with Americans or their investment banker buddies.

For those who elect to choose the money over the interests of their country, there may be no amount of campaign cash that will allow them to return to their seats in the next election.

Wall Street—and too many Congress members—are counting on Americans to NOT pay attention to this proposed legislation.

Let’s do the opposite.

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