I asked subscribers to the Bankster list to rate the bank reform bill that just passed Congress. I appreciate the fact that some folks took the time to rank the three parts of the bill, which include: 1) the Consumer Financial Protection Bureau; 2) the derivatives chapter, and; 3) our favorite "too big to fail" section.
Those that took the time to rate all three sections of the bill averaged a "B" for consumer protection, "C" for derivatives, "F" for too big to fail. However, most Bankster subscribers gave the whole bill an "F." There was general agreement that the bill would not prevent the next crisis because it did not do enough about the financial institutions whose size, power and influence pose a threat to our economy. Bankster subscribers have always cared the most about the "too big to fail" issues and supported the reinstatement of Glass-Steagall, hard size caps on the big banks and other measures to break up the banks.
One Bankster subscriber said: "the legislation is basically a Trojan horse that is a 'gift' for the people on the surface, but actually contains the seeds of a future defeat."
These concerns are shared by the only Democratic senator to vote against the bill, Russ Feingold (D-WI). You remember Feingold, he was the one vote against the Patriot Act at the height of the 9-11 hysteria. He also voted right on every banking bill in the last 17 years: voting against the interstate banking act which allowed the big banks consolidate strength and spread out across the nation; voting against the repeal of Glass-Steagall which encouraged big banks to gamble on Wall Street; and voting against the bill that prohibited Brooksley Born from regulating derivatives.
In voting "no" on the Wall Street reform bill Feingold said: “At the outset of the debate over the financial regulatory reform bill, I made clear that my test for this bill would be whether it prevents another economic crisis. Unfortunately, this bill falls short. The reckless practices of Wall Street sent our economy reeling, triggered the worst recession since the Great Depression, and left millions of Americans to foot the bill. Despite these cataclysmic events, Washington once again caved to Wall Street on key issues and produced a bill that fails to protect the American people from the pain of another economic disaster. I will not support a bill that fails to adequately protect the people of Wisconsin from the recklessness of Wall Street.”
While prevention of the next crisis should have been the major goal of the legislation, that was not the focus of legislators. In fact, Senator Chris Dodd (D-CN) set a low bar for success, when he introduced the Senate bill saying "it wont prevent the next crisis, no bill can."
Public Anger Against Government on the Rise
Is it any wonder that a new Pew Research Center survey finds that by almost every conceivable measure Americans are less positive and more cranky about their government? Just 25% say the federal government has a positive impact on the country and only 24% think Congress does. While frustration with the government is nothing new, the growing anger is new. Right now, 77% percent of Americans describe themselves as frustrated or angry about government. One commenter to Bankster expressed similar sentiments: "I'm so frustrated with letter writing, email sending, phone calls, etc. which generally have little and sometimes no affect. We get crumbs for our efforts when we need the whole sandwich."
I don't think it takes a rocket scientist to figure out that when the economy is in the crapper and people are finding it very hard just to pay the bills, they aren't going to be feeling all that chipper. And they aren't going to be all too happy about a government that can come up with big bold solutions when it is bailing out the big banks to the tune of $4.7 trillion, but cannot figure out how to design even a small program to help American families facing insurmountable debt and rising foreclosures.
Spin Watchers Needed
The frustration over the bailout, the banking bill and government as a whole poses a huge challenge for the Democrats this November and signals a giant opportunity for the Republicans. We can anticipate that the Wall Street bailout will be featured in ads by both parties. The candidates who can successfully "spin" public anger over these issue to their advantage will win, but the true history of the financial crisis, the big banks and the bailout will be left in the dust. We hope that Bankster subscribers will keep an eye out for the most misleading ads and the most outrageous spin. You know propaganda when you see it! Alert us at email@example.com.