With their mojo back, Senate Democrats move to tame Wall Street

Now that the Democrats have a bit of swagger back, Senate Democrats have picked up the pace on Wall Street reform — another issue that definitely needs to be addressed. Yesterday, Sen. Chris Dodd (D-Conn.) passed a financial overhaul bill out of committee on a straight party-line vote.

Meanwhile, Treasury Sec. Tim Geithner warned bankers and other Wall Street maestros to stop fighting so hard against financial reform. That, too, is a reflection of the Democrats’ increased confidence. They are reminding bankers that can pass signifiant legislation without GOP support. From the WSJ:

The 13-10 vote in the Senate Banking Committee comes as Republicans and business groups rethink their strategy about how to shape or derail the financial bill, which some of them argue would reduce credit and potentially cost U.S. jobs. Some Republicans have faulted the White House for pressuring congressional Democrats to push forward without a bipartisan deal.

“Have things been about as dysfunctional as they could be as far as things coming out of committee?” asked Sen. Bob Corker (R. Tenn.). “Yes, and certainly there’s plenty of fault to go around.”

Treasury Secretary Timothy Geithner, in some of his most forceful comments to date, warned on Monday policymakers and the public to “be careful whose voice you listen to” in the debate over new financial rules. His comments, in a speech at the conservative American Enterprise Institute, appear squarely aimed at Wall Street executives and other business leaders who have warned about the unintended consequences of the bill.

“Listen less to those whose judgments brought us this crisis,” he said Monday. “Listen less to those who told us all they were the masters of noble financial innovation and sophisticated risk management. Listen less to those who complain about the burdens of living with smarter regulation or who oppose having to pay a fee for the costs of this or future crises.”

Mr. Geithner’s pitch came a day after the White House cleared a huge hurdle by marshaling its overhaul of the health-care system through the House of Representatives. With that debate largely settled, much of Washington’s focus is expected to shift to reworking financial-market rules. In an illustration of the White House’s growing presence in the process, close to 10 administration officials sat through the Senate panel vote.

Democrats and White House officials, emboldened by the belief they have public support for efforts to rewrite financial rules, have intensified their push in recent weeks. They have stepped up their warnings about the consequences of inaction, with Mr. Geithner saying Monday that “risk will build up again … and future governments will have to act again to socialize private losses in the interest of preventing catastrophic damage.”

383 comments Add your comment

Ragnar Danneskjöld

March 23rd, 2010
7:57 am

Nothing more dangerous than a socialist with a swagger. Thankfully they are not focusing on anything with serious long-term implications, like Iran with a nuke.

T-Town

March 23rd, 2010
7:58 am

Our elected officials got us into this mess, now we’re hoping they will lead us out.

TnGelding

March 23rd, 2010
8:02 am

They’ll find ways to get around any legislation. The derivatives need to be forced to orderly close down. You can’t protect yourself against all risks. In trying to do so you just enrich others and reduce your own earnings.

TnGelding

March 23rd, 2010
8:04 am

T-Town

March 23rd, 2010
7:58 am

Yeah, they were the ones originating loans to consumers they knew couldn’t repay them and issuing AAA ratings to junk.

Joel Edge

March 23rd, 2010
8:07 am

Sure, why not. We’ve screwed future generations on debt and healthcare. Let’s gut the free enterprise system. Then we can move on to rationing and taxing energy. Further grinding out the hope of future generations. For my contribution, I’m going to start working like a government employee
I’ll finish this comment later, coffee break and web surfing time…..

Tilli

March 23rd, 2010
8:08 am

“They are reminding bankers that can pass signifiant legislation without GOP support” (Spell check is your friend CT)
And on this you are wrong. You think that since Obamacare passed the Dems can push through anything. They passed a Senate bill that was voted on before Scott Brown was elected.

Congress screwed up the economy, not Wall Street. Freddie/Fannie enabled the housing crisis that brought down the entire market. Read the facts and stop looking for partisan answers to shovel to the masses.

T-Town

March 23rd, 2010
8:08 am

TnGelding, while what you say is true, remember it was the Gov’t thru Freddie Mac and Fannie Mae that guaranteed them.

schrutebeets

March 23rd, 2010
8:10 am

We shouldn’t forget to take a step back every now and then and look at the big picture.
This financial reform initiative–like Obamacare–is just another battle in the war being waged for this nation’s heart, mind, and spirit.
Are we finally beginning to understand that Obama’s progressive manifesto calls for the destruction of all existing national systems and the rebuilding of new ones in the progressive mold?
Anyone with a functioning brain stem knows that Obamacare wasn’t about providing healthcare access to those who don’t have it. He doesn’t care about those people. He just uses them to distract us from his true objective: Dismantle the existing healthcare system and establish a progressive healthcare system.
And anyone with a functioning brain stem knows that this so-called financial reform isn’t about protecting us from the mean ole bankers and Wall Street executives. It’s about dismantling the country’s existing financial system and establishing a progressive financial system.
He’s doing–or soon will be doing–the same thing with every American system.
Supporters of the Obama Administration–and the progressive movement in general–fall into one of three categories:
1) Stupid: They believe whatever Obama et al tells them to believe even when they have little, if any, actual comprehension of what it is they’re being told to believe.
2) Liar: One of the chief tenets of the progressive movement is the mantra that the ends justify the means. Those in this category are devotees of–and well versed in–progressivism goals and values. They have no problem with lying because they believe that those opposed to their efforts don’t deserve the truth anyway…that the people they are taking from only have what they have because they cheated and abused other classes and races of people to obtain them.
3) Stupid and Liar: Most, not surprisingly, fall into this category.
There’s something even more significant at the core of the progressive v. non-progressive war. Many are reluctant to broach the matter for fear of offending someone. It’s time to cast that fear aside.
Our war, first and foremost, is a clash between Judeo-Christian values and principles and secular humanism (i.e., anti-Judeo Christian values and principles).
This nation can have only one operating philosophy. I believe that philosophy must be Judeo-Christian. It was the philosophy the nation was founded upon. It’s the philosophy the nation must retain if we have any hope of seeing America blessed by God again.
Note the differences between the two. The Judeo-Christian mindset is grounded in an eternal perspective. It’s about making decisions and judgments on behalf of America that are in accordance with what is right and wrong in the eyes of God.
The secular humanist mindset, on the other hand, is grounded in a temporal perspective (i.e., the here and now). It’s about making decisions and judgments on behalf of America that are in accordance with their own worldly ideas of right and wrong.
Proof?
Look no further than at who assembles under the Obama banner: pro-abortion advocates, gay marriage activists, anti-Israel/pro-Palestinian partisans, one-world government supporters, socialists, communists, no-border immigration proponents, terrorist rights champions, global warming freaks, etc., etc., etc.
Obamacare’s passing is a stark reminder of just how far downward this nation has spiraled.
But it has also made it more clear than ever who my enemies are.

Reality

March 23rd, 2010
8:15 am

I am horrified that there has been no changes to Wall Street regulations since the melt down. Does anyone really think that the “big wigs” aren’t again going to push the envelope to make profits? Does anything think that they really care that what they do is put the US financial situation at risk?

I hope that Congress acts swiftly to put into place some regulations – perhaps those that WERE in place before Bush removed them – to prevent this from happening again.

Joel Edge

March 23rd, 2010
8:18 am

Reality@815
Thanks, I’m still laughing.

jt

March 23rd, 2010
8:18 am

Yea, I’m so sure Charlie Rangel, Chris Dodd, and Timbo will straighten out all this money stuff.

Reality

March 23rd, 2010
8:19 am

@schrutebeets: Look in the mirror. Thy enemy is thyself.

JohnnyReb

March 23rd, 2010
8:24 am

schrutebeets – excellent! Do you think in the mind of progressives Obama is A god or THE God?

Joel Edge

March 23rd, 2010
8:27 am

Reality@819
LOL…. Stop, you’re killing me!

T-Town

March 23rd, 2010
8:37 am

A politician only knows how to spend money, it’s not in their genes to save the taxpayers any money. For approximately 16 years the Gov’t (read: both sides of the aisle) spent our money like drunken sailors and didn’t care because everything was good. When the bubble burst the politicians all ran for cover insisting it was caused by the other guys. Now both sides will fight to decide how to fix it and the common man is in the middle.

Jethro

March 23rd, 2010
8:40 am

I got out of the market in 2005. Revamped my 401K contributions in 2007. I got a mortgage at a great rate, I’m debt free, and well prepared if – God forbid – I lost my job.

I did this on my own. I didn’t trust the advice that Wall Street – and Congress – was providing, I sensed the meltdown before it happened (though it did take longer to happen than I thought it would), and I took my investment life into my own hands.

That’s America. It doesn’t matter who’s selling the snake oil – be it Barney Frank or Bernie Madoff. It’s up to me – and each of you – to decide if it’s medicine or watered down whiskey. Congress won’t solve your problems. Wall Street won’t solve your problems. Be responsible for yourself.

Granny Godzilla

March 23rd, 2010
8:41 am

This is the issue of the 2010 mid-term election cycle.
The Democrats keep the house and senate.

The GOP has been played…..by it’s own leadership again.

Ron

March 23rd, 2010
8:49 am

Interesting to note the differences in Jethro and Granny Godzilla. I would assume Jethro will be thriving and happy while Granny Godzilla will still be looking to DC for help.

Ayn Rand

March 23rd, 2010
8:54 am

Atlas is shrugging.

Granny Godzilla

March 23rd, 2010
8:55 am

Ron

Well, I guess that old cliche about assuming would be proved true by your post.

Bray much?

Joel Edge

March 23rd, 2010
8:56 am

Ron
Sounds like you hit a soft spot.

Granny Godzilla

March 23rd, 2010
8:59 am

Joel

I think his soft spot never closed.

arnold

March 23rd, 2010
9:02 am

First..Reality at 8:15. Clinton also removed many of the restrictions on banking. Bush just followed suit. I agree restrictions are needed.

I was a stock broker 1972-1975. There were many restrictions at that time and Wall Street was still able to profit. We also didn’t have the kind of melt down we just went through.

If the Republicans think they will gain votes by not restricting the banking industry, then they are more foolish that their belief of stopping Health care. To side with the bankers is political suicide.

Then, what happens when the Democrats bring up immigration. Does anyone believe the Republicans will gain the Hispanic vote? There’s another loser for the Republicans.

Joel Edge

March 23rd, 2010
9:03 am

Granny Godzilla
Thanks for confirming that. On target, Ron. Fire for effect.

Granny Godzilla

March 23rd, 2010
9:08 am

Joel – Ron

I suspect you just want granny to paddle you both…..EW!

schrutebeets

March 23rd, 2010
9:09 am

Reality, Joel Edge, Granny Godzilla:
“…and God gave them over to reprobate minds…”

granny's friend

March 23rd, 2010
9:10 am

granny godzilla…arent you late for picking up your welfare check?

Ron

March 23rd, 2010
9:10 am

In the next 3 months I will 20-30 previously un employ(able) individuals who are literally “dying” to get to work and make a difference in their own lives. These individuals will have full health care and benefits. They include individuals missing arms and legs but make it up in heart and desire. There will be 95+ retention rate and will be loved and appreciated by their managers and coworkers.

Granny- let me know if you would like to discuss soft spots more-

Joel Edge

March 23rd, 2010
9:10 am

Granny Godzilla
Yuck!

quod erat demonstrandum

March 23rd, 2010
9:11 am

How interesting, a straight party vote. I guess only the opposition is going to be bi-partisan.

That is as long as the King, Obama Le Roi, will allow opposition.

He has already decreed that he will not campaign for non-supporters. I think that is good news for those candidates, the King’s track record in campaigning for others is 100% – they all lost.

Jethro

March 23rd, 2010
9:12 am

Most people ask, “What’s in it for me?” I ask, “What’s in it for them?” If it’s a fair trade off, I’ll make the deal. If not, I won’t.

That doesn’t make me a liberal or a conservative. It makes me responsible for myself. I volunteer, I help where I can, but I automatically distrust anyone who says they are going to make my life better. I’m not inflexible, I just realize that only a very few people are doing something because they genuinely care. All I’m saying is “show me.” I’ll educate myself, thank you. If we all did that, talk radio wouldn’t sound so shrill.

Michael

March 23rd, 2010
9:14 am

The most effective way to rein in Wall Street fraud is to vigorously enforce EXISTING laws against fraud and harshly sentence the people who break them.
1. Mandatory minimum sentences: 25 years for financial fraud that cause a victim(s) losses at a certain amount. More losses through fraud, the more mandatory time.
2. Hire as many federal agents (FBI?) with a background in forensic accounting as needed. Pay them well, and task them to go after the people who are committing the crimes. The goal here is to jail the Madoffs when they are young and the losses are smaller. It makes a little more sense to me to sentence a young Madoff to 75+ years in prison when he commits his first (and only) crime as a free, rather than catch him when he’s in his 70s with a 150 year sentence.
3. Stop these silly ‘civil enforcement actions’ from the SEC. They can only fine the perpetrator, but he’s still free to do it again. You commit fraud, you go to prison.

Reality

March 23rd, 2010
9:20 am

A little history lesson for those that need one….

During Bush’s term, he led a charge to de-regulate the financial institutions. These were the regulations that were put in place after the depression to prevent another financial melt down. But, guess what happened?

The financial institutions (AIG and others) came up with a new product (called derivatives) to take advantage of de-regulation. These derivatives are basically back-room deals that are totally under-the-table with no regulation. These have been identified as a major cause of the current recession (in addition to Bush’s overspending on the war that led to the budget deficit).

THIS is why re-implementing the financial regulations NEED to be done now, and quickly!

Granny Godzilla

March 23rd, 2010
9:21 am

Let’s take a minute to look at this:

granny’s friend

March 23rd, 2010
9:10 am
granny godzilla…arent you late for picking up your welfare check?

Somebody who posts here doesn’t have the ovaries to use the same name or names they normally use to post their opinions and has got nothing of value to add.

Reality

March 23rd, 2010
9:24 am

@arnold 9:02
Clinton may have started the deregulations, but it was during Bush’s term(s) that it became extreme.

Reality

March 23rd, 2010
9:26 am

@Granny Godzilla
I often think that all of these crazy posts are made by the same individual that simply changes their name/handle…. possibly some republican PR person getting paid minimum wage?

Joel Edge

March 23rd, 2010
9:29 am

Reality
Keep thinking that. That’s another liberal belief.

Reality

March 23rd, 2010
9:37 am

@Joel Edge 9;29
To which belief do you refer?

Acer706

March 23rd, 2010
9:39 am

Swagger? Cynthia are you kidding me. The only stuggle with passing The Healthcare Refrom was a battle between Democrats themselves and voters that sign their paychecks.

One-quarter of the current administration it took to pass a SINGLE BILL that needed NO HELP FROM OTHER PARTIES?

Weak politics all-around. The First mention of the contents of our new Healthcare Bill I heard this morning when asking how Dems will be effected in future campaigns…

Answer: “Republicans Want To Deny Children’s Health Coverage And Also Deny Preexsisting Claims…”

Playing Politics With 1/5 of Our Economy?

Deficit Decreases Due To Paying 10yrs For The First 6yrs of The Bills Affect? I’m Not Making This Up!

Lastly, Why Does The 3.8% Tax On Investment Income and Fines For Not Covering Persons Not Kick In Till 2013(300) then again in 2016(600)?

Simply: Cowards.

I Move By Any Corporation Similar Is Illegal. If You Do Not Think So… Then You Do Not Know Govts Current Regulations on Healthcare and Should Not Comment. Please.

Reality

March 23rd, 2010
9:42 am

@Acer – Dude, you sound like you may have some interesting points, but the way you wrote that post is impossible to understand what you’re saying. Re-try?

Road Scholar

March 23rd, 2010
9:42 am

GG: Let me stand back as you kick them in their “soft spot”….repeatedly! You go girl! Just don’t hit their brain…it’s already damaged.

I guess those who don’t want controls also have children who go to a candy or toy store and come out w/o anything. What self control! Not!

Ron

March 23rd, 2010
9:44 am

Granny- I, for one, will defend you on the personal attacks. We will all learn more (from each other) with more of a civil attitude. It is amazing what a calm and meditative mind can do-

blutto

March 23rd, 2010
9:46 am

“Treasury Sec. Tim Geithner warned bankers and other Wall Street maestros to stop fighting so hard against financial reform.”

Mr. Tax Cheat running his mouth like he runs the Treasury. Real reform would start with removing people like him from public office.

T-Town

March 23rd, 2010
9:50 am

Reality

“Clinton may have started the deregulations, but it was during Bush’s term(s) that it became extreme.”

This like saying Clinton started the forest fire, but Bush fanned the flames so it’s more his fault. It appears there is plenty of blame to spread all around.

quod erat demonstrandum

March 23rd, 2010
9:51 am

Reality,

Both Cinton and Phill Gramm fueled the explosion of the derivitives industry when they dismantled the Glass-Steagall Act in 1999. 98 Senators voted for it.

NYorker

March 23rd, 2010
9:51 am

PUBLIC SUPPORT, if you call having college kids and people who do not pay taxes as public support. Then we are all in trouble!

“The democracy will cease to exist when you take away from those who are willing to work and give to those who would not.” -Jefferson

Joel Edge

March 23rd, 2010
9:53 am

“possibly some republican PR person getting paid minimum wage?”
It’s not the American people. It’s an astroturf campaign by those wascally Republicans.

quod erat demonstrandum

March 23rd, 2010
9:53 am

Acer706,

Totally agree. The real battle for Health Care was within the Democrat party. Think of it this way, the opposition was bi-partisan, the support was only the democrat, a divided democrat party is not one the swaggers, but limps

Cosby Smith

March 23rd, 2010
9:54 am

Follow the Money trail. Health care is full of Taxes that will cripple the USA. Taming Wall Street, look no further than Fanny and Freddie, both Government run, both in deep financial stress, both paying their executives who have party alligence absurd salary’s. the Dems claim they put Medicare – now broke and full of corruption, Social Security, broke and dysfunctional on the books and now socialized medicine..which will be just as dysfunctional and costly. 50% of the people are now paying 99% of the taxes, guess what happens when they quit paying. Take over wall street, they did, bailed out AIG and then allowed the Management great sums of money, bailed out GM and look what the CEO brings down, Senator Dodd himself, retiring and walking away with at least $2mm from his “War Chest”. All graft and corruption and now we have a President acting as a rouble rouser. March 21, 2010 the Day The USA died. It officially became a Banna Republic controlled by mob rule. Congress is for sale!

Reality

March 23rd, 2010
9:55 am

@T-Town and quod erat: You are “straining at gnats” here. The point is that we need those financial regulations back in place NOW.