Statement of Bartlett Naylor, Financial Policy Advocate, Public Citizen’s Congress Watch Division

Bart-Naylor-004-ws-300x224Note: Today, U.S. Senate Committee on Banking, Housing, and Urban Affairs Chair Richard Shelby (R-Ala.) released a discussion draft of a bill intended for a committee vote next week. The 216-page draft contains 83 sections changing current banking law.

Chairman Shelby proposes major changes that threaten to undermine the already fragile Wall Street reforms intended to prevent another 2008 financial crisis.

The Shelby bill raises the threshold for close supervision of banks from $50 billion to $500 billion. America’s experience with the failure of large financial institutions has been disastrous. Removing safeguards that now apply constitutes a gamble that the nation can ill afford to lose.

The measure also eliminates the Volcker rule prohibition on gambling with taxpayer-backed FDIC deposits for any bank with less than $10 billion in assets. That’s simply an invitation for hedge funds to obtain a bank charter.

The chairman’s draft subjects all the new Dodd-Frank reform rules to a regulatory review process designed to identify and repeal outdated rules. New rules for Wall Street have no place in a review process that is supposed to target old rules. This is nothing more than a thinly veiled and cynical attempt to gut Wall Street reforms under the radar.

The draft legislation also contains a number of other proposed changes that we are continuing to examine.

We urge committee members to remain committed to fundamental Wall Street reform. Any changes should be authored not by industry trade associations, but Americans who are part of the real economy that Wall Street should be serving.


Statement of Lori Wallach, Director, Public Citizen’s Global Trade Watch

IMG_3031The Fast Track train went off the rails today. The U.S. Senate vote was supposed to generate momentum for Fast Track in the U.S. House of Representatives, where it’s in deep trouble, with almost every House Democrat and a significant bloc of GOP lawmakers opposing it.

The only reason to upend the required procedures for a “revenue bill” and bring up Fast Track in the Senate first was to get a huge victory to build momentum in the House. But that strategy backfired and Democrats in the House remain committed to standing up for their beliefs that the trade package would do a lot more harm than good.

President Barack Obama would now enjoy broad support for a forward-looking trade agenda if only he had implemented the reforms he announced as a candidate, including to “replace” the Fast Track procedure created by Richard Nixon with a more inclusive, democratic mechanism. Instead, Congress is unlikely to revive the 1970s Fast Track trade authority Obama seeks.

Congress has denied Fast Track for all but five of the past 21 years, with 171 Democrats and 71 GOP rejecting President Bill Clinton’s request in 1998. Since 1988, only Presidents Ronald Reagan and George H.W. Bush have persuaded Congress to delegate Fast Track authority.
Fast Track for the Trans-Pacific Partnership (TPP) is an especially bad idea. After six years of negotiations, the text is almost complete. Yet under the Hatch-Wyden-Ryan Fast Track bill, the pact would remain secret from the public until 30 days after its text is locked. That the text would be made public 60 days before the formal signing ceremony is irrelevant, because it would be too late to fight for needed changes.

The rhetoric being used to sell the trade package is really far off from the reality of what is in it. It is like being in the twilight zone. Thanks to WikiLeaks, we know the TPP includes an expanded version of the investment provisions found in the North American Free Trade Agreement (NAFTA) that incentivize the offshoring of high-wage American jobs and the investor-state dispute settlement system that exposes U.S. policies to attack in foreign tribunals.

The administration chose to use the weak labor and environmental standards that President George W. Bush included in his last trade deals. It was the 2007 Peru Free Trade Agreement, not the TPP, that was the first U.S. trade agreement to have labor and environmental standards in core text enforceable by the same terms as the commercial provisions. A 2014 Government Accountability Office investigation found these labor and environmental standards now also used for the TPP failed to improve working conditions.

What has leaked out already is deeply troubling. Many members of Congress who – unlike the public – are allowed to read the TPP are warning us that this is a bad deal.

At Nike, President Obama said that those concerned about the TPP rolling back food safety, environmental or financial regulation “are making stuff up” and no trade agreement can do that.

In fact, these rollbacks have happened repeatedly under past pacts. The “sovereignty” provisions found in Section 8 of the Hatch-Wyden-Ryan Fast Track bill are nothing new and appear in implementing legislation for past U.S. trade agreements under which U.S. food safety and environmental policies have been rolled back already. Examples of rollbacks due to trade deals include:

  • Gutting rules about importing only food that “meets or exceeds” U.S. safety standards, so we now import food that does not meet U.S. standards; and
  • Rolling back environmental laws and regulations – from Clean Air Act regulations to U.S. labeling of dolphin-safe tuna and more.

Please see the top reasons to oppose Fast Tracking the TPP and the Myths vs. Facts about the Fast Track legislation.

Flickr photo by watchingfrogsboil

Flickr photo by watchingfrogsboil

Despite the fact that opposition is growing to a proposal to give the president Fast Track trade authority, the McConnell-Boehner Corporate Congress seems intent on pushing it through. We are hearing rumblings that U.S. Senate Majority Leader Mitch McConnell (R-Ky.) will try to start the Fast Track bill debate on the Senate floor as early as Tuesday. The legislation would allow the president to sign the controversial Trans-Pacific Partnership (TPP) — or any other dangerous trade deal — before Congress has voted to approve it. He could then railroad the deal through Congress in only 90 days, with limited debate and no amendments allowed. The co-sponsors claim their proposals would improve Fast Track, but a close look at the bill reveals the same fundamental flaws as past Fast Track bills.

Public Citizen is tracking other public interest attacks in the Corporate Congress next week as well:

•    Legislation to end the oil export ban is to be introduced next week by U.S. Sen. Lisa Murkowski (R-Alaska). She may try to attach it to the Fast Track bill. Why is lifting the nearly 40-year-old ban on exporting domestic crude oil a bad idea? Because it would raise gasoline prices for U.S. motorists, lead to more environmentally harmful fracking and greenhouse gas emissions, and tether us to an economic model of dependency on raw natural resource extraction.
•    We hear that a major banking bill that has yet to be introduced is slated to be marked up by the Senate Banking Committee next Thursday. The committee chair, U.S. Sen. Richard Shelby (R-Ala.), is expected to advance a sweeping bill with significant cuts in basic safeguards that govern large banks.
•    The House Financial Services Subcommittee on Oversight and Investigations is holding a hearing about Dodd-Frank and “regulatory overreach.” This will be a forum for the financial industry to vent its complaints about Dodd-Frank. What’s key to remember is that the law was designed to stop the excessive risk-taking of Wall Street, which led to the 2008 global financial crash and drove people into foreclosure and bankruptcy. Dodd-Frank provides badly needed consumer protections.
•    Finally, we hear that a House version of chemical safety legislation will be marked up on Thursday by the House Energy & Commerce Committee’s Subcommittee on Environment and the Economy. This is related to the Frank R. Lautenberg Chemical Safety for the 21st Century Act (S. 697), which, in a bit of an affront to the late senator, would take the country’s chemical safety policy backward. The House version is also bad, but for different reasons.

Craig Holman thumbWith today’s news report that Hillary Clinton will actively work with and solicit funds for a super PAC supporting her candidacy, the very notion that these groups are “independent” of candidates is exposed as a fallacy. Her Republican counterparts also have been actively soliciting funds for their super PACs, with Jeb Bush still delaying his announcement as a candidate so he can go so far as to relegate some of his campaign functions to a super PAC he created solely to support his candidacy. Super PACs are super-connected to the candidates they support.

Super PACs are increasingly dominating federal elections, providing campaigns with the means to sidestep contribution limits as they work closely with candidates and party committees. Now, they even are taking on many of the critical functions of candidate campaigns. As super PACs become de facto campaign committees for candidates, they provide a direct and valuable link for wealthy donors to curry favor with lawmakers and candidates.

The Federal Election Commission (FEC) needs to step up to the plate and restrain this coordination between super PACs and candidates. If the FEC fails to carry through, then we must pass the anti-coordination legislation (H.R. 425) introduced by U.S. Rep. David Price (D-N.C.) that would do precisely that.

One year after nearly half of Duke’s shareholders voted in favor of the company disclosing its political contributions, the company has made little progress to address the shareholder concerns. According to the Center for Political Accountability, from 2013 to 2014 the company made small changes to its political spending policies, like adding board oversight, but it has still fallen far short of the full disclosure that shareholders want.

Given Duke’s track record, shareholders are right to be concerned about the company’s political contributions. In fact, it’s hard to overstate Duke’s role in making North Carolina politics feel like the Wild West. In a recent report, the Institute for Southern Studies (ISS) rated the utility giant as the No. 1 corporate power-broker in the state of North Carolina. ISS ranked Duke fifth in state election spending for dropping $944,250 into state elections in 2012 and 2014, and it rated Duke second in lobbying clout. Taken together ISS writes that Duke is, “a clear leader in its ability to both elect and pressure state lawmakers.”

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