The Senate Republicans are refusing to allow a vote on the Merkley-Levin amendment, which would put a meaningful version of the Volcker Rule into law (splitting off proprietary trading from major banks).
After weeks of dancing around, the Democrats finally have a signature issue on which to fight. Senator Carl Levin frames it exactly right: “It’s a sad day when the power of Wall Street can overwhelm the power of the American people in the US Senate.”
This is the opportunity that White House claims it has long sought – to have an intense fight on a financial reform issue that everyone can understand. Paul Volcker made his determination long ago: the big banks are too big and must, in this fashion, be broken up. Senators Merkley and Levin negotiated the precise language of their amendment in good faith. The Republicans have made their answer clear: No way.
Time for President Obama to make the call.
Only the president can break through the daily logjam of information. Only the president can define the issues in the simple, powerful and convincing terms that people can grasp. Only the president can insist – this is a matter of urgent national priority.
The economic analysis (Volcker), political back-story (Brown-Kaufman and all that involved), and just the right rhetoric are already in place:
“We got into this financial crisis because Wall Street set the rules to benefit itself, and now with an assist from Senate Republicans, they’re doing it again,” said Merkley. “Obviously the lobbyists are afraid they’ll lose this vote, and in typical Wall Street fashion their solution, with help from Senate Republicans, is to rig the result. Main Street is being shut out of this debate. It is time to stop letting Wall Street call the shots – let this amendment have a vote.”
“The long arm of Wall Street reached directly into the Senate chamber today,” Levin said. “By blocking us from even debating this amendment, the Republican leadership is carrying Wall Street’s water and standing in the way of real reform.”
This is a defining issue for the president. Either he takes up the Volcker Rule – proposed by his administration, to great fanfare (and some skepticism) in January. Or he rolls over – admitting that Wall Street has won.
We know where Goldman Sachs and its fellow travellers stand on this issue – adamantly and publicly opposed. And we pointed out here in February which way the Republicans were likely to go.
“But if you don’t have the votes in the Senate, what can you do?” This one is easy. You stop the clock and put everything else on hold. The president calls the American people to order and asks them to take a long hard look at the issues and the corporate interests at stake.
And then you start to pound away. Day in and day out, the president and other leading members of his administration need to come out swinging with relentless pursuit of substance on TV talk shows and prime time speeches – demanding an up-or-down vote on Merkley-Levin.
Admittedly, this may be awkward for leading officials, who have been rather accommodative to financial interests over the past 15 months or so. That’s unfortunate (for them), but now entirely water under the bridge. All is forgiven to the policymaker who finally gets it and changes course in the right direction.
Don’t move on. Pick up the baseball bat that Paul Volcker has given you. Either that or go down to the most embarrassing, humiliating, and memorable defeat in the history of Wall Street-Washington confrontations. It’s the president’s call.
The Baseline Scenario 
SHRIEK!!!!!!!!!!!!!!
I’ve tried calling the White House; my senators, God Almighty – what else can we do? I really think it’s time for the pitchforks.
PS – For all the good it will do, I just posted this on the White House contact page:
PLEASE do NOT allow Richard Shelby and Mitch McConnell to rip reform from the grasp of the people. Support – no – FIGHT FOR – Merkley/Levin and Paul Volker. For once quite being a professor and be THE PRESIDENT. I didn’t support you so I could watch you roll over and play dead for the GOP and Wall St.
Four words seem to sum up how the majority of *voting* citizens are feeling about the status quo, including a Wall-Street rigged DC:
Arlen. Specter.
Blanche. Lincoln.
You’d think someone in the WH might reasonably draw the conclusion that colluding with Wall Street is not a winning electoral proposition — although it is true that Lincoln’s proposal on derivatives is said to be tough, looks like Alabama voters viewed it as ‘too little, too late’.
You would think these folks would get the big picture by now.
They are going to be out of a job unless they pick up the banner of the people over the bansters.
Where is the president indeed. By not reining in the banks when they were weak, he is already risking the safety of our economy.
It is now or never.
Those who do not see the writing on the wall won’t be around much longer – good riddance.
The lobbyists do not elect you – we do. Pay attention.
“Where Is The President?”
The Corporatist in Chief can be found in the same place he was when Brown-Kaufman came up for a vote.
Germany has forced the debate. Congress must have intelligent debate on where the foreign currency otc markets belong for both the end user and the American taxpayer to eliminate systemic risk. Here is what Congress must debate today, before a vote:
http://www.thederivativeproject.com/Blog.html
I agree that Obama would use the bully pulpit to drum up bottom up pressure for popular measures he supports.
Therefore, the fact that he has never done so proves that in every case he supports anti-popular, anti-democratic, pro-corporate policy like in this case. He opposes any restraints on Wall Street whatsoever.
However, it’s false that the Democrats in the Senate “don’t have the votes”. They’ve had the votes to pass anything they want since the start of 2007. The fact that they keep in place the “rules” that allow Republican obstruction simply means that they want such obstruction.
Establishment Democrats oppose finance reform (and every other kind of reform) just as much as the Republicans do, so it’s part of the “two” parties’ symbiotic relationship that they keep in place anti-democratic senate procedures which allow small minorities to engage in obstruction. It’s convenient to pretend you want real reform while maneuvering the other party into playing the bad guy.
But if these bogus “rules” (which again, can be changed at will) didn’t exist, the nominal majority wouldn’t have that protection. Its own anti-reform agenda would then be clear.
That’s why, after the Dems doubly lied for years saying “we need 60 votes before we can pass truly progressive legislation” (a double lie because they really didn’t want to pass such legislation, and because the filibuster rules as well can be changed anytime if they really wanted to change them), it was so embarrassing to them when they actually did have 60 votes most of last year. They were out of excuses.
Their site: http://act.boldprogressives.org/act/petition_gambling/?source=tw
Their cause: “The big Wall Street banks gambled away our money on a reckless housing bubble and then insisted we spend more money bailing them out. We need you to support the Merkley-Levin proposal to end this risky gambling and other conflicts of interest.”
Their numbers: “35,331 people have taken action—88% of our goal of 40,000!”
http://en.wikipedia.org/wiki/Carl_Levin: In 2010, Senator Levin served as Chairman for the questioning of the senior partners of Goldman Sachs Group Inc. relating to the SEC fraud accusations straining the latter.”
Is the question, “where is the president’ or is the question “what are we thinking”?
This president has shown his true allegience since his first appointment, Larry Summers. He has not waivered from this position. Pro Wall Street, Pro Banks, anti small business, empty populist rhetoric.
His immediate disbanding of the twitter, FB, electronic communications with his grass roots organization was a storm cloud.
Wake up people and realize that this president is an obsticle to a progressive movement. He made his way up the laddar by compromising personal principles whilee disguizing his persona, and he continues to demonstrate again and again his consistency.
We’re not going to call out something thats not there. Wishing so, don’t make him so.
Russ, while I tend to agree with your central opinion that Democrats want to vote on financial reform just as little as Republicans do, I really doubt that a system in which the majority party changes the rules at a whim to suit its needs is really a system that you want. Since both the Democrats and the Republicans change their opinions on the utility of the filibuster (for example) depending on their status in the Senate, I can readily imagine a Senate that bogs down every session on the shape of the negotiating table. Or better yet, a Senate in which the rules simply state that the committee chair’s vote is the only one that matters. The committee might be constituted of Senators according to the parties’ respective seats in the Senate as a whole, but all that would really mean is that a long-term incumbent gets to make the decision. Sure, that sounds great when your side is in the majority, but not too good when your party inevitably falls out of favor.
Yeah, there’s an annoying level of political gamesmanship going on, but I’d rather have a situation in which the players learn how to work the existing rules rather than one in which the rules get made up as the players go along.
Are you really this naive, Simon? Obama’s embrace of Rubin, Summers, Dodd, Geithner, and Bernanke will sink the Democratic party in November.
Look at the track record. Like the winners in last night’s election, he ran as an outsider against the Clinton establishment. After winning, he reappointed the Clinton establishment.
The financial reform bill is a farce.
Simon, you are too kind.
The President called on Wall Street to accept reform. He practically begged them not to fight reform. He called them out, saying things like “that is a fight I’m willing to have” and decrying the “fat cats.”
By not keeping up the pressure by joining in at crucial points, he shows his true colors. Does he really want reform for the American people and a sound financial system for future generations, or does he want a weak law that he can spin?
A truly excellent column !
Administration reluctance to be assertive probably stems from the fear that the banks — having less profit — would curtail lending and thereby impede the recovery. Obama’s message,then, should be to increase the federal stimulus measures for job creation at the same time as we reform our financial systems. Both top priorities.
Financial reform is essential to prevent future disasters; federally-spurred job creation is essential for short term recovery.
This fall will be the first election (I’ve been a voter since the early 80’s) that I will volunteer to help get a candidate elected. My support will only be for independent (preferably) and/or non-establishment candidates (fresh politicians with a “take back our government” message).
How many other like me are there?
So you’re against majority rule?
If readers REALLY want to know how bad Obama has been on these matters, they need to read Johnson’s “13 Bankers” and Robert Kuttner’s new book. Paul Volcker was recently asked what he thought of Tim Geinther. Volcker said that he could not utter the words in public that he would need to use to fully describe the harm Geithner has done the economy and the country.
Not at all. The system of majority rule in the House seems to work just fine. What I am against is members of either party complaining about how their wonderful policies are being blocked by a heinous and obstructionist minority when that same party was being called heinous and obstructionist not too long ago.
I much prefer a system in which the minority has at least some say in the process. It may not get everything it wants, but I think the public is better served overall if actual competing views are considered instead of versions of the same basic outlook that differ merely by degree.
Who are you talking about? Obama was NEVER a professor.
I give up on Obama.
He’s a one term President to be best know in later history as Herbert Hoover II.
Too bad, he could have been FDR II.
Obama taught law in Chicago.
He didn’t have a title, but was regarded as one by his students and the school at the U Chicago Law School.
http://www.factcheck.org/askfactcheck/was_barack_obama_really_a_constitutional_law.html
A representative democracy is just a scam. tyranny of the majority is intentionally produced by the elite through lack of education/illogical arguments (such as Fox news) to justify the concept. A representative democracy is the lowest form of democracy there is, it’s built top down. We need democracy built bottom up, a democracy that truly represents the people. Even more pathetic is a two party system. So in order to be represented, you have to be either blue or red?
There will never be any true change with the US/western form of democracy period.
Kirk, could you tell me where Volcker was interviewed?
thanks
He never helfd a position of tenure track “professor” at the U of C (as in assistant, associate or full professor in generally recognized ascending order of seniority) and except for a rare mis-speaking, has never described himself as such. Rather, he held the title of “lecturer” or “senior lecturer” which communicates teaching one or more classes in any given quarter depending on the lecturer’s schedule.
So all in all, “professor” is a term of art in academia even though it commonly has a more generic meaning to your average person.
I wouldn’t call it a whim if a majority party ever really did want to govern in the public interest and blasted away the pre-existing procedural obstructions to doing so. Far from being a whim, the very desire would be revolutionary.
But of course neither existing party has any desire or intention other than kleptocratic ones, so it’s a moot point.
Actually, since I no longer expect that the existing system will ever again pass a constructive piece of major legislation, since I expect any major bill will be no-change at best (like the sham finance bill is shaping up to be) and if they can get away with it a reactionary assault making things far worse (like the health racketeering/bailout bill), by now I regard gridlock as the best we can hope for, so long as the system exists in this form. So I want the obstructions to remain in place.
I was just objecting to the ongoing nonsense, in the face of the overwhelming evidence, that the Democrats would pass public interest legislation if they could, and that they’re being obstructed by the Republicans, when the clear fact is that to this day the Reps can’t do anything the Dems don’t let them do.
Therefore they can’t do anything the Dems don’t implicitly want them to do, since as I said, the need is so dire that no level of breaking with “procedure” wouldn’t be called for if someone had the power to act on behalf of the people and truly wanted to.
But the vicious fact is that, just as much as the Republicans, the Democrats are criminals and enemies of the people.
And I am most definitely your average person.
The day following four primaries and one election wherein incumbents and party backed establishment candidates were defeated; FinReg failed in the Senate on a cloture vote.
The bad news of course is that FinReg, as watered down as it is, failed for the time being. Score this a temporary victory for the corporate communists and their shills in the Senate.
The good news is that turnout in yesterdays elections is described as fair to slightly above average. Obviously the American people aren’t turning to pitchforks and we aren’t listening to self-patronizing high minded lunatics who advocate abstaining from the democratic process.
Surely, leadership from Obama would work wonders for financial regulation. I’m not sure I agree, however, that the president should “stop the clock and put everything else on hold.” What about carbon emissions legislation? Thomas Friedman makes a compelling case in this morning’s column that energy should be a priority. Perhaps Johnson and Friedman should get together and discuss.
In the meantime, here is a link to further remarks on choosing between energy and the banks:
http://innocentsmithjournal.com/2010/05/19/what-to-do-when-the-republic-is-on-fire/
I’m proud to say that Jeff Merkley is a freshman Senator from Oregon, barely two years into the job, and here he is one of the leaders in this effort. He’s proof positive that, for all the corruption in Washington, there are still honest politicians. Our other Senator, Ron Wyden, plays in the same league.
All of you nihilists get off your butts and make your calls. That’s how things get done, no other way. We put Merkley in office because he promised this sort of independence, and he’s delivered. Anything can be done, so do it.
I am confused. It appears that 2 Democrats, Maria Cantwell and Russ Feingold, voted with the Republicans and refused to allow a vote, because the language in the amendment was not strong enough.
I was always curious why so many anti-Obama people called him a “socialist” during and after the election. I always thought he was a rather conservative, pro-corporate type. My feelings were confirmed when I saw him at one of his first press conferences flanked by Larry Summers and, yes, Robert Rubin.
A request for Simon and James:
The office of a Democratic Senator who has always been responsive to my concerns (and has appreciated the financial support I’ve provided) has not responded to my repeated inquiries about her “no” vote on the ongoing Fed audit proposal. It seems that few Democrats who oppose the stronger measures are willing to explain their position. (I had no expectations for any honesty from the GOP caucus.) Would you be willing to outline the various aspects of financial reform, categorizing them by the sincerity with which one could disagree? For example, naked CDS sales and purchases, the absence of continuing Fed audit, the failure to bring back Glass-Steagul, and many more seem like issues about which there cannot be honest disagreement. But I can imagine some honest (if misinformed) disagreement about other financial reform proposals. With our political leaders unwilling to directly address their critics, it seems we have to rely on expert testimony alone to tell us which votes are being bought, which are voting on ignorance, and which are taking principled stands, right or wrong. I hope you can provide this for me.
Re: @ Anonymous____he is a “fluff master” ,nothing more than a glorified used car salesman like his predecessor,…
Now here is an full-grown adult male remonstrating with a slug who at every opportunity has turned his back on promises made during the 2008 campaign and has shown himself to be a friend to torturers, warmongers, snoopers, banksters, and oil, drug and insurance interests. At what point does Johnson recoil at his own nauseating credulity. Headline: Short of mass demonstrations and the general strike there will be no authentic reform of the financial system. Some showboating there will be, perhaps, but no meaningful reform. Ask yourself if the Fed audit legislation just passed has any substance. Just don’t ask Bernie “Roll Me Over” Sanders. He’s out there somewhere looking for his soul at the moment.
Re: @ The Derivative Project____Excellent! Germany has forced the debate? Yes indeed,…where we’ve neglected the laws, such as “Naked Shorting” – Germany says that’s what they’ll do. Why? Because it’s the right thing too do. It really is illegal, and on the fringe elsewhwere as borderline criminal, so just ban it, period! Priority Trading – you be the judge of this no-brainer? The EU will probably make sure once the ECB sets up new rules, this “CRAP” won’t fall through the cracks, as everything in America does. In fact,…it seems likely whatever the US rejects, the EU will pick-up ,and run with it! Finally , the last thing they want is an unregulated derivatives market, and the “Slimey Limies” telling them how to manage their money. So,…I guess pretty much what the US rejects in, “FinReg” the EU will be happy to take-up the banner, and make it the overwhelming law of the “New Old` World Order”?
Re: @ Russ____Someone that understands why Levin,Moynahan,Nelson,Sanders,Kerry,Feingold,Boxer,and Reid ,etc.,etc.,….oh yea,…Lieberman,and all the rest that have proudly served our country for the last “30 Years” fight so hard for our rights,…pathetic!
Re: @ Winston Smith____Who are the “GOP” going to get to run…”Palin”, “The Ageless(J’Mc) Maverick”, “Brownie from Mass.”,oh, wait? That’s it! The young congressman behind the minority leader? Obama hasn’t a prayer unless he gets illegal immigration legislation passed, then he’s a shoo-in, otherwise it’s “Hillary Baby”, and Chelsea in 2020?
Let me know when and where and I will bring my corporate communist sign. Can’t go on strike though. I’m self-employed, sorry.
Obama’s problem? “He’s trapped by the capitalist system, and by the structure of imperialism.”
—Evo Morales, President of Bolivia
The difference between Obama and Bush? “One is gringo, the other is black.”
—Ibid
“Power concedes nothing without a demand. It never has and never will.” F. Douglas
So what are we willing to demand and what lengths are we willing to go to demand it? Greece has some good action models to go with.
Poor America just can not get its act together. “It aint worken folks”. Were going down hill faster than a sled. Thanks Dickie for all that cooperation you promised the oil corporations. President Eisenhauers predictions comming true everywhere.
Tea Party, that’s the answer. Vote for the Tea Party!
Just look for the Tea Bag on your ballot. That’s where your “X” goes! By the way, who’s runing on the Tea Party ticket? Any one know yet? Some republican cast off I suppose. Drill Baby Drill!
Dickie set us up with a real “Tar Baby” this time. All that Goo is going to be sticken to a lot of polititions this time. Don’t need no foxes and bears when we got republicans and democrats. Lots of “Tar Baby Goo” for both sides.
“We have met the Enemy and he is us” (Pogo 1958)
Hey – All this frustration with the leaders of the “free” world.
Founding fathers who would have imigrated away from Poor America years ago.
A country that will be run by Christians and others who believe in Big Foot, Flying Suacers, American exclusiveness and rewriting the text books with a Texas Christian slant.
Goin down hill faster than a sled greased by Cheney and his oil friends. That’s a Tar Ball if I ever saw one. Tar Balls are what Tar Babies are made of.
Lets all go to the west Floridas new black beachs.
Thanks Dickie,you did a great job on America!