Two weeks ago, Barack Obama got personal with Senator Mitch McConnell over financial reform regulation. In his weekly radio address on April 17, Obama claimed that McConnell was lying about the bill at the behest of Wall Street:
Just the other day, in fact, the Leader of the Senate Republicans and the Chair of the Republican Senate campaign committee met with two dozen top Wall Street executives to talk about how to block progress on this issue. Lo and behold, when he returned to Washington, the Senate Republican Leader came out against the common-sense reforms we’ve proposed. In doing so, he made the cynical and deceptive assertion that reform would somehow enable future bailouts – when he knows that it would do just the opposite.
Is it deceptive to claim that the reforms, as currently written, would enable future bailouts? If it is, it will be interesting to see the tongue-lashing Obama gives Senator Barbara Boxer, the Democrat from California. As the Senate begins debate over the legislation, the first thing the legislators will consider is an amendment she offered. What does it do?
According to today's Washington Post: "The first proposed amendment, introduced by Senator Barbara Boxer (D-Calif.), would prohibit using any more taxpayer money to bail out troubled financial companies."
Why do that if the original bill already accomplished that? Is Boxer going to offer amendments to create a new consumer protection agency, too?
Even the New York Times, in its ever-understated way, acknowledged the obvious: "In a floor speech, Mrs. Boxer again rejected the Republican criticism, although her amendment suggested that there might have been some reason to question the possibility of future bailouts."
And as the upper chamber works out the specifics of the legislation, well-heeled Wall Streeters can get access to the man who wrote the bill, Banking Committee chairman, Christopher Dodd, for a mere $10,000. Dodd will appear at a fundraiser for New York Senator Kirsten Gillibrand. With passage of a reform package inevitable, global finance big guns like Goldman Sachs CEO Lloyd Blankfein and Citigroup CEO VIkram Pandit have already pledged their support for the legislation in an effort to stay on the right side of those whose rules will be shaping the industry for decades and, perhaps, as a downpayment on future engagement with the politicians they need.
Lo and behold, the fundraiser next week will give many other Wall Streeters the same opportunity.