Ditch it or Fix it
Rep. Jerrold Nadler, D-N.Y., does not sit on the House Financial Services Committee, even though he has an interest in financial services — his district, after all, includes Wall Street.But Main Street was on Nadler's mind last week as he testified at a Congressional Oversight Panel hearing on the impact of economic stabilization efforts on commercial real estate lending.
Small businesses simply are not getting the benefits of government programs intended to get credit flowing again, Nadler said. His solution: Scrap the Troubled Asset Relief Program, let the Federal Deposit Insurance Corp. fail banks and give the government a more forceful hand in the big banking companies kept alive by taxpayer-financed life support.
But presuming the Treasury Department sticks to its Tarp guns, Nadler wants the program buttressed, either with a $100 billion program to capitalize new banks that would lend freely to worthy borrowers, or with capital grants made to healthy small or regional banks that could use the funds to expand their reach.
"At least these banks presumably would supply a lot of credit to the system while the Bank of Americas and Citigroups figure out what to do" with problem assets, he said.
That Was Quick
The financial services lobby wasted no time attacking a nascent Obama administration plan to overhaul the regulatory system, sending letters opposing the proposal before it was even out.The American Bankers Association and the Independent Community Bankers of America were particularly steamed by the suggestion that Congress consolidate all banking regulators into one. Both groups argued that such a plan would effectively destroy the dual banking system.
"Such a federal regulatory agency would undoubtedly have a strong bias toward federally regulated institutions," wrote Ed Yingling, the ABA's president. "Therefore, state-regulated banks would be at a disadvantage."
Cam Fine, the ICBA's president, wrote that it would be "both dangerous and shortsighted" to have a single regulator.
"We should no more eliminate the checks and balances in the current bank regulatory system than eliminate the multiple branches of government that are the foundation of our country," Fine warned. "Overwhelming concentration of power in any governmental or economic sector is counterproductive and unwise."
Sure, Gene Sperling spent eight years in the Clinton White House and is now Treasury Secretary Timothy Geithner's counselor on policy issues of the day. But who cares? The most impressive line on his resume is surely the four years he spent as a consultant to the TV show "The West Wing."When people introduce Sperling, "they say he worked at the White House for eight years, was the national economic adviser, helped create the CDFI fund and the new market tax credit," he told an audience at a Federal Reserve Board conference Thursday. "Yawn. Yawn. But he was a consultant for the TV show West Wing! Why is advising the fake West Wing for four years more impressive than working in the real West Wing for eight years?"
It may have been a rough year for banks and other financial firms, but their lobbyists still seem to be winning.Last month The Hill published lists of the top Washington lobbyists, and there were some familiar faces in the crowd.
Several financial groups, including the ABA, the ICBA, the Financial Services Roundtable and the National Association of Federal Credit Unions made the paper's list of 50 or so stellar trade lobbying groups.
Goldman Sachs Group Inc., JPMorgan Chase & Co., Citi and B of A were all represented on the paper's list of greatest corporate lobbyists, which included Citi's Nick Calio, B of A's Ed Hill, and JPMorgan Chase's Naomi Camper and Rob Griner.
Some individuals, like Calio and Hill, made the list last year, too. But other top persuaders from 2008 were gone — most notably representatives of Fannie Mae and Freddie Mac, who once ranked high on the list but whose companies are no longer allowed to lobby.
Maybe it's time for a new slogan about the resilience of the financial lobby. Something harkening back to the old rhyming U.S. Mail adage: Neither rain nor sleet nor … credit crunch, nor greater curbs on the power lunch, nor liquidity droughts will stop this bunch.