Big financial firms losing power on Capitol Hill
Large banks are on the verge of losing a key legislative battle over the shape of financial reform, an unusual setback that reflects the continued political backlash over their role in creating the financial crisis.
The particular battle big banks are allegedly losing need not detain us for the moment. Rather, I have two comments. First, it’s a testament to its essentially imperial status that after nearly destroying the planet the financial industry has any power left to lose. But the headline writer tells us this legislative loss is “unusual” — as indeed it is. Check out, for example, who won and who lost on cramdown, plain vanilla, and CFPA exemptions. Even now, a scant 12 months after triggering the biggest financial meltdown since the Depression, the financial industry almost never fails to get something it wants from the United States Congress.
Second, they haven’t lost yet. The Post informs us that “lobbyists on both sides say they regard the battle as over,” but I’ll believe that when I see it. The Senate hasn’t yet taken its crack at this legislation, after all, and I will be very much surprised if the finance lobby has decided to cry quietly in its beer and let this particular regulatory indignity pass without sprinkling a few million more dollars on the right committee members in hopes of getting an early Christmas present. Don’t count your chickens before they’ve hatched.