Former New York senator and Secretary of State Hillary Clinton is well known to most players in the political world. Though she has billed herself as a progressive Democrat, many banks and other businesses see her as an acceptable alternative to GOP presidential candidate Donald Trump, who many on Wall Street view as unpredictable.
Following are her views on a range of subjects.
'Too Big to Fail'
In contrast to her Democratic competitors, Hillary Clinton has tried to steer a middle path when it comes to Wall Street reform. Her primary opponent, Sen. Bernie Sanders, D-Vt., called for breaking up the big banks, but Clinton has focused on nonbanks, or "shadow banks," that she says helped cause the financial crisis, and unlike financial institutions, were not reformed by the Dodd-Frank Act.
In a speech in October, Clinton gave her clearest views to date on her vision of reform. (She reiterated her views in a December op-ed.) Key points include:
- Imposing a "risk fee" on all banks with more than $50 billion of assets, with higher charges for institutions that rely heavily on short-term funding.
- Combating "too big to jail" by increasing the statute of limitations for financial crimes, enhancing whistle-blower protections and providing more funding to the Justice Department and the Securities and Exchange Commission.
- Eliminating what Clinton calls a loophole in the Volcker Rule that allows banks to invest up to 3% of their capital in private equity and hedge funds.
- Giving bank regulators more power to break up or restructure the big banks.
- Strengthening oversight of the "shadow banking" sector, including hedge funds, investment banks and other nonbanks.
- Imposing a tax on the high-frequency trading, which Clinton says makes "our markets less stable and less fair."
Clinton renewed her pledge Aug. 23 to cut regulations for community banks and credit unions while also signaling plans to embrace the burgeoning fintech sector. In an op-ed on LinkedIn, Clinton specifically cited the need to cut red tape for smaller institutions, emphasizing that doing so will expand access to credit for small businesses.
"We also need to make it easier for small businesses to get financing," Clinton wrote. "My plan will reduce unnecessary regulations on local community banks and credit unions, while defending tough the new rules on big Wall Street banks. And we'll make it a priority to expand access to credit and capital for underserved communities, from inner cities to Coal Country to Indian Country."
She provided further details in a fact sheet released alongside the op-ed, calling community banks and credit unions the "backbone of small-business lending in America."
The fact sheet highlighted the fintech industry, saying Clinton wants to "harness the potential of online lending platforms and work to safeguard against unfair and deceptive lending practices."
While Clinton has previously pledged to cut regulations for small banks, the op-ed is her most high-profile statement on the issue to date — and comes after the Democratic National Convention pushed her agenda in other areas further to the left. Privately, some bankers have wondered how committed Clinton is to regulatory relief. By making it a core piece of her plan to help small businesses, she appears wedded to the proposal.
Her mention of online lending is also significant. The fintech sector has been expanding by leaps and bounds during the past few years — but neither Clinton nor Republican presidential nominee Donald Trump has appeared to pay any attention to it. The fact sheet's brief mention of it signals that Clinton's campaign sees its potential to expand credit, but refers to fears by some consumer groups that some fintech firms engage in dubious practices.
Moreover, the Clinton plan touches on other areas important to banks, including fostering the development of community development financial institutions and expanding the authority of the Small Business Administration.
It calls for expanding and making permanent the new market tax credit and "doubling support for" CDFIs and the State Small Business Credit Initiative.
Clinton has backed a plan by Sen. Tammy Baldwin, D-Wis., that would restrict the "revolving door" between government and the private sector.
The Financial Services Conflict of Interest Act would ban government workers from accepting bonuses, known as "golden parachutes," from their former corporate employers; expand a cooling-off period on lobbying government agencies after leaving the public sector to two years; and require financial regulators to recuse themselves from actions that would benefit a former employer or client for two years.
The former New York senator has also been criticized for being a recipient of significant Wall Street contributions, as well as the speaking fees she has earned for giving speeches to firms like Goldman Sachs. During the primary debate on Jan. 17, Sanders claimed Clinton had earned more than $600,000 in speaking fees from Goldman.
Clinton did not rebut the claim, but has generally deflected criticism by saying she has won over many diverse fans, including some on Wall Street, working in downtown Manhattan to help with rebuilding efforts after the 9/11 attacks.
Clinton has been a fierce advocate for the Consumer Financial Protection Bureau, opposing any changes to its structure or its funding. In October, she wrote a letter to House Democrats urging them to vote against a bill that would have replaced the agency's single director with a five-person commission.
"If this bill passes, consumers' primary advocate in the U.S. government would have to fight with one hand tied behind its back," Clinton wrote. "Perhaps that's exactly what Republicans and their corporate allies want. This legislation is just the latest salvo in the relentless Republican war to 'defund and defang' the CFPB."
The letter makes it clear that if elected president, Clinton would oppose any significant changes to the CFPB.
Sen. Elizabeth Warren, D-Mass., who founded the bureau, has repeatedly invoked Clinton’s support for the CFPB in recent campaign appearances.
"Donald Trump wants to roll back financial regulations to turn Wall Street loose to wreck our economy again," Warren said during the Democratic National Convention in July. "Democrats fought for a strong consumer agency so big banks can't cheat people. We won, but Republicans and lobbyists battled us every step of the way. Five years later, that consumer agency has returned $11 billion to families who were cheated, and Republicans they are still trying to kill it."
Clinton has not spoken in depth about monetary policy.
Clinton has outlined a comprehensive tax plan on her website, calling for an increase on taxes for the mega-wealthy but pledging not to raise taxes on the middle class.
Her plan has won praise from progressive economists for its effect on curtailing tax subsidies for the wealthy and encouraging investors to hold investments for longer terms, but those who oppose it say it might encourage investors to divest their holding earlier than they would otherwise.
Individual income tax: Clinton would implement what she calls a "fair share surcharge" on multi-millionaires and billionaires and implement the so-called Buffett Rule "to ensure the wealthiest Americans do not pay a lower tax rate than hardworking middle-class families." It would require that those making more than $1 million to pay at least 30% of their adjusted gross income in taxes. Clinton also supports capping the value of certain exemptions and deductions at 28%.
Capital gains: To counter what Clinton calls "quarterly capitalism," she has proposed revisions to the capital gains tax: For top earners ($400,000 or more per year) the top rate on capital gains would remain at 39.6% for a second year. The rate would then be lowered on a sliding scale over the next four years. Investments held for six years would be taxed at the current favorable capital-gains rate. Clinton has also said she supports raising taxes on carried interest.
Corporate tax: Clinton has called for closing tax loopholes like inversions that give benefits to firms that shift profits and jobs overseas. Clinton’s plan would charge an "exit tax" for companies leaving the U.S. She has also called for simplifying and cutting taxes for small businesses.
Estate tax: Clinton has attacked her GOP rival Donald Trump for proposing a repeal of the estate tax. Clinton wants to restore the tax to its 2009 status, decreasing the amount that’s exempt per couple to $7 million from $10.9 million.
Clinton’s plan would apply to estates exceeding $3.5 million per person and at a 45% top rate. Currently, the per person exemption is $5.45 million and the top rate is 40%.
Health Care and Employee Benefits
Clinton has laid out a concrete position on the Affordable Care Act, better known as Obamacare, saying "we've got to defend" the law from Republican attacks. She has also advocated for:
- Paid family leave. "We can design a system and pay for it that does not put the burden on small business," Clinton said at the first Democratic presidential debate in October.
- Reducing out-of-pocket costs by lowering co-pays, deductibles and prescription drug costs.
- Rewarding value-based health care and continuing delivery system reforms begun by the Affordable Care Act.
- Repealing the ACA's so-called "Cadillac tax" provision, a tax on the most expensive benefit plans designed to raise money for ACA initiatives.
- Opposes reducing annual cost-of-living adjustments for Social Security and privatizing the program. Clinton favors reducing how much the benefit drops when a spouse dies. She also supports giving Social Security benefit credits to a person out of the paid workforce who is acting as a caregiver.
- Opposes raising the retirement age.
- Guaranteed paid leave.
- Increasing the federal minimum wage. She's advocated for state and local efforts to go above the federal floor.