seeking knowledge and laughter, putting a bullseye on inaccuracy


Why Wall Street Got a Pass from Democrats

Very good article from The New Republic: "A Wasted Crisis?" by Paul Starr. The subtitle is "Why Democrats did so little to change Wall Street.

He reviews several books discussing the Democratic Party response to the economic crisis and Wall Street, each of which I put on my reading list. All of it reinforces my very strong belief that if we do not reform the campaign finance system, our Republic will remain beyond our reach. Support the Rootstrikers!

From the Paul Starr piece:

Finance-friendly government has also resulted from the industry’s increased lobbying and political contributions in an environment where countervailing pressure from consumer groups is negligible. Even in the latest battle, the imbalance has been staggering. According to Kaiser, a consumer coalition in 2009 announced it would raise $5 million to support financial reform; in comparison, the lobbying expenditures by the finance industry in 2009 and 2010 totaled around $750 million. Wall Street political contributions, McCarty and his co-authors point out, have gone to both Democrats and Republicans, though not indiscriminately. “The more conservative wing of each party (moderate Democrats and conservative Republicans) garners substantially more contributions than the more liberal factions.” The finance industry is bipartisan in the sense that it pushes both parties to the right.

Former Senator and present lobbyist, Chris Dodd was a chief author of the effort to ensure Wall Street didn't once again kill our economy. From the article:

Dodd, whom Connaughton describes as “Machiavellian,” readily made concessions to Republicans who were not going to vote for the bill, while ignoring his own Democratic colleagues. “Dodd and the Treasury Department wanted a squishy bill,” Connaughton writes, “and the Republicans were willing to work with Dodd to weaken it.”

Where have we seen this before with Democrats? The stimulus is the first thing that comes to mind - where the stimulus was watered down and included major non-stimulative tax cuts to woo Republicans than never supported it. The problem is that Democrats can't even count on the middle-of-the-road Democrats to vote for a bill unless they give major concessions to Republicans who will never vote for it anyway.

And why is that? Probably because those Democrats come from districts where Republicans are far better at winning elections with deeply flawed talking points that nonetheless play well on television. So Democrats have to avoid doing anything that Republicans can easily demagogue (often by lying and recognizing no one will call them on it).

Corruption and Stupidity

It is sometimes frustrating to look at the poor choices made by our elected representatives - especially when you have to play the guessing game of whether they intentionally made poor choices or if it was an accident. I think most of recognize that they intentionally make poor choices that result in benefits for those who finance their campaigns. This should not be a surprise, what else should we expect with our current system?

I think it was John Dahl who believed that the only way to achieve just government would be for the policies to be enacted by those who had no interested in the outcome. If you ask a poor person to make rules, or a rich person to make rules, you will get each making rules that favor themselves (theoretically anyway - people frequently act against their interests out of ignorance). However, if you had people make rules and then rolled the dice to decide who was rich or poor, you should probably have policies that are more equitable because people would hedge their bets, not knowing where they would end up. While a useful theoretical exercise, it doesn't seem practical - or even particularly fair to be that equitable!

I previously mentioneda new campaign by Larry Lessig (a person for whom I have great respect) that aims to reform Congress - so we can have elections where a select few cannot dominate the entire process. Last week, I joined the donor strike. "I'm pledging not to donate to any federal candidate unless they support legislation making congressional elections citizen-funded, not special-interest funded." Though I have not given much historically, I've been improving my financial position and I expect I will be able to donate more in the future (as I did with Obama).

His organization is have an impact. Ben Nelson, a Democrat from Nebraska, has raised over $2 million from insurance agencies and health care providers that oppose the health care reform we need. Change Congress asked Nebraskans whether Nelson was promoting their views, or that of his financiers. He took a lot of umbrage but softened his opposition to the public option (perhaps the key part of a better future for all of us.

I gave them some money to support their work asking folks in Louisiana if Landrieu is representing their opinions when she opposes the public option or if she is representing the folks that gave her $1.6 million and oppose it.

Note that Change Congress is not a partisan organization or even one that focuses on health care - the point is to focus on the way that big money influences our elected representatives. Consider giving them a donation - it doesn't have to be much. Knowing their ideology, they would rather get a whole of of small donations than a few big ones. Give a bit and tell your friends to help. You don't have to give anything to sign the petition."

In other news - Slate has an interesting piece about the Competitive Enterprise Institute - a group that used to be heavily funded by Exxon. Turns out that Exxon stopped the major donations (or filtered them, I spose). CEI continues to shill for corporate interests but is apparently moving on from climate change. I expected this day to come - we'll slowly see these groups stop talking about climate change as they realize that, like another "missing link" - that between cigarettes and lung cancer -- their efforts to obfuscate the truth have failed.

Nonetheless, they are not hurting for funding:

But while CEI may not have given up on the climate debate, it has taken up the debate on a lot of other topics. CEI scholars still produce papers, are still available for TV interviews, and still churn out op-ed columns on subjects like broadband regulation, ethanol subsidies, smoking bans, and genetically modified crops (in order: bad, bad, bad, good). And CEI's fundraising is healthier than ever. In 2007, after Exxon cut off its funding, the group reported a near-record $3.54 million in revenue. Coca-Cola, Monsanto, Google, and Microsoft topped the list at Thursday's gala.

Google? Damn. Even as they support a whole bunch of other policies (open access broadband, network neutrality) that CEI campaigns against.

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