The banks — hard to believe in a time when we’re facing a banking crisis that many of the banks created — are still the most powerful lobby on Capitol Hill. And they frankly own the place.
– Sen. Dick Durbin
On Thursday night, the U.S. Senate took what is probably the most clear-cut vote for or against the big banks they will ever take. The question: should we force the “too big to fail” banks to shrink themselves back to the size they were in 2003, or should we let them keep growing as big and systemically risky as they want? The overwhelming answer from the Senate: let them keep getting bigger!
The Brown-Kaufman SAFE Banking Act amendment voted on Thursday night created a confounding division in the Senate. Some of the most conservative Republicans sided with a bunch of the most liberal Democrats in favor of forever doing away with “too big to fail.” However, the vast majority, a mix of so-called liberals, conservatives and moderates, voted to keep things just as they are.
There has been a lot of speculation over where exactly the division was on this amendment. Dylan Ratigan called it “The People’s Party” vs. “The Bankster Party.” And Matt Taibbi wondered if there wasn’t some kind of sick joke involved.
It was a strange roll call, but I think I’ve figured it out. It was all about campaign contributions.
Looking at finance/insurance/real estate sector campaign contribution data from OpenSecrets.org, I found that senators who voted against the Brown-Kaufman SAFE Banking amendment have received nearly twice as much money from the big banks as the senators who voted in favor of it. Specifically, the average senator voting against the amendment has received $3,578,898 from the financial sector over the course of their career, while the average senator voting in favor has received only $1,846,292. It’s very close to double for those opposed. And when we are talking about millions of dollars, double is a whole lot of money and a whole lot of influence.
We can’t keep letting the banks receive public support to get bigger and riskier through hidden subsidies and bailouts. They are bigger right now than they were when they were first deemed too big to fail. The current financial reform bill does almost nothing to solve too-big-to-fail. It is business as usual. I really wonder, will Obama be proud of this bill when he passes it — does he really believe it will help to prevent the next crisis and the next round of bailouts, or does he just think it’s a political winner?
Below are the individual contribution totals for each senator from the finance/insurance/real estate sector divided by how they voted on the Brown-Kaufman SAFE Banking amendment. The data makes it perfectly clear — senators voting against the amendment were bought off and doing the bidding of the banks. The senators voting for the amendment were acting with independence and doing the only reasonable thing — voting to limit the size of the too-big-to-fail banks.
The 33 Yes Votes
|Senator||Career $ from Finance|
|Sen. Mark Begich [D, AK]||$412,637|
|Sen. Jeff Bingaman [D, NM]||$1,059,499|
|Sen. Barbara Boxer [D, CA]||$2,765,288|
|Sen. Sherrod Brown [D, OH]||$1,620,430|
|Sen. Roland Burris [D, IL]||$4,900|
|Sen. Maria Cantwell [D, WA]||$1,878,690|
|Sen. Ben Cardin [D, MD]||$2,756,636|
|Sen. Bob Casey [D, PA]||$1,355,841|
|Sen. Tom Coburn [R, OK]||$1,078,264|
|Sen. Byron Dorgan [D, ND]||$1,455,834|
|Sen. Richard Durbin [D, IL]||$3,055,424|
|Sen. John Ensign [R, NV]||$2,589,370|
|Sen. Russell Feingold [D, WI]||$990,917|
|Sen. Al Franken [D, MN]||$1,022,598|
|Sen. Thomas Harkin [D, IA]||$2,534,445|
|Sen. Ted Kaufman [D, DE]||$0|
|Sen. Patrick Leahy [D, VT]||$615,682|
|Sen. Carl Levin [D, MI]||$2,260,576|
|Sen. Blanche Lincoln [D, AR]||$2,447,809|
|Sen. Jeff Merkley [D, OR]||$721,157|
|Sen. Barbara Mikulski [D, MD]||$1,301,068|
|Sen. Patty Murray [D, WA]||$1,687,337|
|Sen. Mark Pryor [D, AR]||$1,345,008|
|Sen. Harry Reid [D, NV]||$4,389,858|
|Sen. Jay Rockefeller [D, WV]||$2,213,734|
|Sen. Bernie Sanders [I, VT]||$181,095|
|Sen. Richard Shelby [R, AL]||$5,371,330|
|Sen. Arlen Specter [D, PA]||$6,406,258|
|Sen. Debbie Stabenow [D, MI]||$1,899,835|
|Sen. Tom Udall [D, NM]||$1,062,336|
|Sen. Jim Webb [D, VA]||$563,161|
|Sen. Sheldon Whitehouse [D, RI]||$1,222,607|
|Sen. Ron Wyden [D, OR]||$2,658,024|
The 61 No Votes
|Senator||Career $ from Finance|
|Sen. Daniel Akaka [D, HI]||$556,295|
|Sen. Lamar Alexander [R, TN]||$4,940,775|
|Sen. John Barrasso [R, WY]||$295,932|
|Sen. Max Baucus [D, MT]||$4,790,487|
|Sen. Evan Bayh [D, IN]||$4,393,347|
|Sen. Michael Bennet [D, CO]||$835,796|
|Sen. Kit Bond [R, MO]||$3,255,538|
|Sen. Scott Brown [R, MA]||$1,015,364|
|Sen. Samuel Brownback [R, KS]||$1,336,269|
|Sen. Richard Burr [R, NC]||$2,988,952|
|Sen. Thomas Carper [D, DE]||$2,311,778|
|Sen. Saxby Chambliss [R, GA]||$3,483,860|
|Sen. Thad Cochran [R, MS]||$662,234|
|Sen. Susan Collins [R, ME]||$2,273,113|
|Sen. Kent Conrad [D, ND]||$2,507,437|
|Sen. Bob Corker [R, TN]||$3,150,750|
|Sen. John Cornyn [R, TX]||$4,597,492|
|Sen. Michael Crapo [R, ID]||$1,779,063|
|Sen. Chris Dodd [D, CT]||$14,367,412|
|Sen. Michael Enzi [R, WY]||$1,087,043|
|Sen. Dianne Feinstein [D, CA]||$3,657,556|
|Sen. Kirsten Gillibrand [D, NY]||$2,334,456|
|Sen. Lindsey Graham [R, SC]||$1,951,429|
|Sen. Chuck Grassley [R, IA]||$2,605,399|
|Sen. Judd Gregg [R, NH]||$1,070,249|
|Sen. Kay Hagan [D, NC]||$585,694|
|Sen. Orrin Hatch [R, UT]||$2,481,543|
|Sen. Kay Hutchison [R, TX]||$4,694,038|
|Sen. James Inhofe [R, OK]||$1,477,202|
|Sen. Daniel Inouye [D, HI]||$1,453,487|
|Sen. John Isakson [R, GA]||$3,849,408|
|Sen. Mike Johanns [R, NE]||$697,621|
|Sen. Tim Johnson [D, SD]||$3,143,865|
|Sen. John Kerry [D, MA]||$18,112,577|
|Sen. Amy Klobuchar [D, MN]||$734,117|
|Sen. Herbert Kohl [D, WI]||$73,950|
|Sen. Jon Kyl [R, AZ]||$3,741,994|
|Sen. Mary Landrieu [D, LA]||$2,500,584|
|Sen. Frank Lautenberg [D, NJ]||$3,478,817|
|Sen. George LeMieux [R, FL]||$0|
|Sen. Joe Lieberman [I, CT]||$10,084,996|
|Sen. John McCain [R, AZ]||$33,474,029|
|Sen. Claire McCaskill [D, MO]||$863,393|
|Sen. Mitch McConnell [R, KY]||$5,247,103|
|Sen. Robert Menéndez [D, NJ]||$4,151,772|
|Sen. Lisa Murkowski [R, AK]||$875,690|
|Sen. Bill Nelson [D, FL]||$3,213,078|
|Sen. Ben Nelson [D, NE]||$2,844,056|
|Sen. Jack Reed [D, RI]||$2,897,782|
|Sen. James Risch [R, ID]||$228,711|
|Sen. Pat Roberts [R, KS]||$1,647,286|
|Sen. Charles Schumer [D, NY]||$15,918,336|
|Sen. Jeff Sessions [R, AL]||$2,158,535|
|Sen. Jeanne Shaheen [D, NH]||$1,046,765|
|Sen. Olympia Snowe [R, ME]||$1,700,184|
|Sen. Jon Tester [D, MT]||$603,993|
|Sen. John Thune [R, SD]||$3,636,776|
|Sen. Mark Udall [D, CO]||$1,781,168|
|Sen. George Voinovich [R, OH]||$2,770,340|
|Sen. Mark Warner [D, VA]||$2,632,766|
|Sen. Roger Wicker [R, MS]||$1,263,098|
Today, Mary Bottari put a funny twist on big banks. Here it is from Bankster USA:
“America’s Women to Dodd — Size Matters”
U.S. Senator Chris Dodd
Chairman Senate Banking, Housing and Urban Affairs
Dear Senator Dodd,
As women and as taxpayers, we are writing to you today to tell you that size matters.
Usually we love big. Big boxes of chocolate, big boxes of wine, big — well you know. But when it comes to big banks and big bank bailouts, it’s a whole different story.
As you get ready to take up bank reform in your committee next week, we need to talk.
When Congress voted to repeal depression-era Glass-Steagall protections, it put the big banks on Viagra. Since then they have had a big problem and it has lasted a lot longer than four hours.
The top five banks hold 50% of all bank assets. That hurts. They are simply too big for their britches. They have been ramping up those big bank fees, paying out big bank bonuses and spending big bucks on bank lobbyists to defeat reform.
We know what those big banks are telling you — “size doesn’t matter.” JP Morgan’s Jamie Dimon may be cute, but he is just a player. Big bank bravado only leads to big bank bailouts. After spending $4 trillion on the latest one, we simply can’t afford to get knocked up for another.
If you were wondering about Obama’s crisis fee, here’s a good analysis from Dean Baker and Center for Economic Policy Research. Summary: it’s not great, but it’s a concession to people who are angry about at the administration for doing very little for the real economy. What would be better is a real recoupment tax, something like a financial transactions tax. Capping the size of the biggest banks from too-big-to-fail size will also create opportunities for medium to small banks, create more money flow in the system for more people, and more jobs everywhere.
From a mailing from CEPR:
…This means that Fannie and Freddie were losing money effectively doing exactly what the TARP program was originally intended for, buying up bad mortgages from banks. It would be reasonable to insist that the banks cover these losses as well.
The FCRF will also do little, if anything, to shrink the bloat in the financial sector. The financial sector has quadruped as a share of private sector GDP in the last three decades. In contrast to the FCRF, a financial transactions tax (FTT), along the lines recently introduced by representative Peter DeFazio in the House and Tom Harkin in the Senate, would go far towards reducing the volume of transactions that serve little or no productive purpose. Such a tax could also raise more than $100 billion annually, which would go far towards repairing the damage caused by this downturn.