Tom Carper has proposed an amendment to the financial reform bill that would severely weaken consumer protections to the point where it is understood to be one of the more destructive changes to the bill. Yesterday, Zach Carter wrote an excellent piece analyzing its potential consequences for financial reform:
There are two consumer protection amendments getting serious attention on the Senate floor this week, one of them positive, one of them incredibly destructive. Both revolve around the concept of “preemption”—the ability of federal regulators to block states from enforcing laws aginst banks that operate within their borders. Over the past decade, state regulators tried to crack down on subprime outrages, but federal regulators stepped in to protect the megabanks. If we want to establish a fair financial system, we have to empower states to take action against abusive banks.
That’s what makes a new amendment from Sen. Tom Carper, D-Del., so dangerous.
At OpenLeft, Chris Bowers has called the amendment “the most dangerous to Wall Street reform.”
Yesterday, I noted that the data we compiled for Big Bank Takeover helps shed light on Carper’s motivation: the same lobbying firm that pushed for similar changes to the House bill is home to Carper’s former chief of staff, Jonathon Jones. When Rep. Melissa Bean stripped consumer protections out of the House bill, she appears to have been acting at the behest of her ex-chief of staff, John Michael Gonzalez, who now lobbies for the firm Peck, Madigan. Gonzalez had lobbied on behalf of the Chamber of Commerce around the “Bean preemption amendment.”
The Chamber, of course, is acting on behalf of big banks. JPMorgan Chase, for instance, has worked closely with the Chamber of Commerce on financial reform issues for the past several years. The bank is a top career donor to both Carper (#2) and Bean (#4). It isn’t alone among big banks in giving big to Carper; Bank of America (MBNA) is number one, and Citigroup is number three. After Bean spoke at a JPMorgan board meeting last June, executives there showered her with cash.
These are the sorts of relationships that position Bean and Carper as the big banks’ chosen representatives in Congress, and they’re the sort of relationships which position them to lead the fight against the banks.
The extent to which Carper’s actions in the Senate are dictated by Jones (and the big business interests he lobbies for) has been especially evident in recent weeks.
The Hill reported last week that Carper wanted to “strike legislation in the Wall Street overhaul bill designed to give shareholders greater power to name corporate board of directors.” The article quotes Business Roundtable president John Castellani saying that his group would oppose the bill if the provision were included, because it “allows small shareholders with an agenda to disrupt the governance process.” (The quote also sums up the problems Big Business has with democracy itself: too much power for the little guy).
The Business Roundtable, of course, is a client of Carper’s eternal chief of staff. Here’s what he lobbied around in the first quarter of 2010 (according to disclosure filings):
Issues relating to executive compensation, shareholder votes and proxy access. S. 1074, The Shareholder Bill of Rights Act of 2009; H.R. 2861, The Shareholder Empowerment Act of 2009. Legislation and regulation pertaining to derivatives. S. 1691, The Comprehensive Derivatives Regulation Act of 2009; H.R. 3269, Corporate and Financial Institution Compensation Fairness Act of 2009. (emphasis mine)
Jones appears to have Carper’s ear like no one else in Washington. Here Carper is in Politico, gushing about his former aide:
The senator seemed to relish the chance to talk about Jones, calling a reporter back between votes in the cloakroom to gush over his longtime aide.
“Jonathon is the most unrelentingly positive person I’ve worked with,” Carper said. “The glass can be bone dry, and he sees it as half full.”
(Of course, doing political dirty work for big business usually pays well enough to keep the glass more than half full.)
While Jones himself isn’t lobbying for the Chamber of Commerce, fellow lobbyists at Peck Madigan are lobbying on behalf of the Chamber around financial reform, including Bean’s ex-chief of staff, Gonzalez. Gonzalez is also working with Jones to lobby for the Business Roundtable.
What’s disturbing about Jones and the rest of the staffers on our list of 240 revolving door lobbyists is that while they were working inside the federal government, they were likely preparing themselves to work on behalf of big business interests in the future. Why take a bribe while still serving in government when you can leave your job after two years and make five times as much working for big banks?
Here is Jones preparing for his role as a corporate lobbyist (also from Politico):
In 2003, Jones played an instrumental role in organizing a regular meeting of Democratic lobbyists and Senate staffers. Every other Monday during the congressional session, 80 to 100 lobbyists and top staffers for Democratic members plotted strategy in a conference room at the Hall of the States near the Capitol.
The inside-outside government dichotomy breaks down when you consider how these kinds of backroom meetings between lobbyists and staffers actually drive our politics.
That’s why events like the Showdown on K Street are so critically important. These lobbyists deserve much more scrutiny for the work they do to corrupt our democratic process as Washington “insiders”, and next week, they’re going to get it.
Originally posted at OurFuture.org.