Curbing Wall Street

If you have a yellow "Support Our Troops" sticker on your car - or even if you don't - you should know the name of the Senators who just traded in our troops, their families, and our military readiness for the easy cash offered by auto dealers. There's no rational policy reason for this exclusion: It's special interest politics, pure and simple. These Senators acted against the objections of military leaders and Gen. Petraeus' wife Holly. But they're not just voting to hurt soldiers: Every American who buys a car on credit is likely to suffer if this "instruction to Senate negotiators" prevails..

Call it "clunkers for cash." Auto dealers are generous with their campaign contributions, both individually and as a group. And they're usually community leaders, active and influential in local politics (and local campaign giving). The National Auto Dealers Association, the lobbying group for new and used car vendor, called the tune and these solons danced. Take a look at the Association's leadership and then ask yourselves: Would you buy a used Senator from these men? more »

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Momentum is building for putting a historic conference between the House and Senate online and on live television, as they debate the future of financial reform. This is the time to contact Senators and Representatives to support this critical step toward open government - and a stronger, fairer, safer economy.

Yesterday we asked conservatives to join with progressives in calling for the House/Senate financial reform conference to be broadcast on live television. We pointed out that this would be consistent with the spirit of the GOP's "Sunlight Resolution," and with a number of conservative calls to avoid "backroom" deals as health reform was being finalized. We also pointed out that a broadcast of this kind would weaken the influence of bank lobbyists, which means we're likely to get better legislation.

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Turning conflicts of interest into "win/win" situations can be a form of brilliance. Pretending those conflicts don't exist can be a form of indifference. That's why it was troubling to hear the President say today that financial reform "is not a zero sum game where Wall Street loses and Main Street wins. As we've learned in today's economy, we're all connected." True - but a connection can either be a lifeline or the rope that drags you down. more »

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Things have been moving pretty quickly lately in the interlocking worlds of politics and financial reform. While there is a lot we don't know, here are three statements we can probably make with a high degree of certainty:

1. If the banks had been on the ballot yesterday voters in both parties would've voted them down.
2. A couple of determined Senators can make a difference.
3. If you want to rally the troops, don't use Larry Summers as your general. more »

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Anyone who's ever seen a Terminator movie knows that civilization ended when a computer system called "Skynet" came alive and tried to terminate the human race by starting a nuclear apocalypse. After last week's "flash crash" on Wall Street, they might have wondered if Skynet wasn't working on a financial apocalypse instead.

We still don't know what happened more than a week later, and a new SEC study will probably raise more questions than it answers. Here's what we do know: Wall Street has become such a high-speed, high-tech gambling house that it can be plunged into chaos without anybody having a clue what's happening or the wherewithal to prevent it. "Real time" - where the effects of ultrafast computer events are perceived at human speed - is never less "real" than it is where Wall Street is concerned.

As a reggae rapper named Big Youth once said, "If you ride like lightning you'll crash like thunder." more »

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PowerPoints, emails, and transcripts obtained by Sen. Carl Levin's Permanent Subcommittee on Investigations illustrate the real magnitude of Sen. Al Franken's victory today. Sen. Franken was able to pass an amendment which eliminates the conflict of interest that's created when ratings agencies "compete for business." It passed the Senate in a 64/35 vote - and it was a bipartisan victory, no less, with 10 Republicans joining 54 Dems to support it.

Here's how broken our current system has become: Not only are the ratings agencies competing as for-profit businesses, but our two largest agencies are publicly traded companies. more »

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The trade association for payday lenders objected to what they called my "name calling" in their blog yesterday ... then called me a "pig."Why? Because I quoted Aristotle and told a story about Jesus. Well, to be fair, I did suggest their industry might be "evil" according to traditional definitions of the term. But that doesn't explain the payday defender who called me "Doofus Major du Jour."

There are some more civil arguments being used to defend payday lenders, however, and many commenters repeated them in the Huffington Post and in the DailyKos. These arguments are myths. They're being repeated by reasonable, well-intentioned people who have been misled by a wealthy lobby and its flacks.

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There are basically two dimensions to the financial crisis. One is the way finance has evolved into a gambling operation that's fundamentally risky and fails to contribute to the real economy. The other is plain, old-fashioned greed - the kind that exploits the weak and vulnerable in a shameful manner, the kind that depends on political patronage to survive, the kind that used to be called pure, Old School, straight-up Biblical-style evil.

Well, evil came to Washington last week, in the form of executives from the "payday loan" industry - and from all reports it was very politely received. more »

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The country needs meaningful financial reform a lot more than it needs more political analysis. Yesterday, however, the two became even more intertwined than usual. By compromising on good policy on Thursday, it looks like Democrats have outsmarted themselves politically too. Now the only fix left for them is to push for the best possible policies going forward. more »

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Harry Reid got it right when he said that the GOP is "making love to Wall Street" - and when politicians and bankers "make love" it's the public that gets screwed. Sen. Shelby's so-called "consumer protection amendment" failed, as expected.(!) But what happens next? Progressives have captured the public mood and are changing the dynamic in Washington. It's time to capitalize on the momentum and press for the best reform possible.

Progressives, take a bow. Then keep on fighting. more »

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