Connecting the Dots: Does Wall St. Want Dodd Bill?
Tom Bevan – Tue Apr 20, 1:00 am ET
After witnessing all the back room wheeling, dealing, political and media manipulation that was used to pass health care, it's no wonder people are questioning not only the method but the motives of the Democrats and the Obama administration when it comes to financial regulatory reform.
So let's walk through this step by step. First, the SEC files a lawsuit alleging fraud against Goldman Sachs, the timing of which simply reeks of politics.
Next, Chris Dodd (and other members of the administration), use the SEC suit to try to force through regulatory reform which they claim will end future bailouts but which critics say will actually institutionalize "too big to fail" by effectively turning big Wall Street banks into quasi-government backed entities like Fannie Mae and Freddie Mac.
And it's not just Republicans who think this. In an interview with Politico yesterday Democrat Brad Sherman, a member of the House Financial Services Committee, put it in blunt terms: "there are serious problems with the Dodd bill. The Dodd bill has unlimited executive bailout authority. That's something Wall Street desperately wants but doesn't dare ask for. The bill contains permanent, unlimited bailout authority."
This morning we learned another disturbing coincidence: that Barack Obama's former White House Counsel, Greg Craig, will represent Goldman Sachs in its lawsuit with the FEC.
We also know that, despite their tough on Wall Street rhetoric, Democrats were on the receiving end of $12.7 million in contributions from Wall Street in the most recent campaign cycle, nearly twice as much as Republicans. President Obama alone raised $3.4 million from Wall Street - including nearly a million from Goldman Sachs.
In fact, Dodd's bill appears to be riddled with "carve-outs" - provisions written into the bill to appease certain special interests. One Republican K Street lobbyist told the Huffington Post, "Obtaining a carve-out isn't rocket science. Just give Chairman Dodd [D-Conn.] and Chuck Schumer [D-N.Y.] a $@#%load of money."
And the bill is now coming under fire from the left as well, with a coalition of former Democratic officials and regulators arguing in a letter to Harry Reid that Dodd's bill will do nothing to prevent a future crisis.
Yesterday afternoon Chris Dodd told a group of reporters that the issue of financial regulation boils down to a simple question: "Whose side are you on?" Dodd, of course, was suggesting anyone who disagrees with his bill is on the side of Wall Street, but the more dots you find to connect the easier it is to come to the conclusion that this is a bill that Wall Street would absolutely love to see pass.