Saturday, May 5, 2018

Drawing Conclusions, Inferring Motivations from Campaign Contributions

A Democratic candidate for the New Hampshire 1st U.S. Congress seat is getting a lot of attention for saying that New Hampshire's two Democratic senators sold out to the bank lobby when they voted for a change (gutting/repealing/repairing--depending on your point of view) of the Dodd Frank Act which was supposed to protect Main Street from Wall Street after the near catastrophe of the financial meltdown of 2008.

Terence O'Rourke says their votes to "gut" Dodd Frank were a betrayal of core Democratic Party principles and the reason for their votes was simple: They are in the pay of the banking industry lobby.

Barney Frank, in his youtube video begs to disagree:
He is the author of the law which the Senate voted to change and he says 95% of the law was left intact by the changes, so it was hardly an evisceration of the law.

https://www.youtube.com/watch?v=4NUlVA8dT5A

He explains that the American banking industry has 3 components: Big banks with over $250 billion dollars (often trillions) in assets, which if they fail could start a chain reaction in the economy.   Middle size banks which hold between $10 and $250 billion and "community banks," small banks which played no role in the financial crisis.

The changes would exempt all but the banks with over $250 billion from federal government stress tests to be sure they are not going to fail.

Community banks, the little guys have complained that a law intended to discipline the big boys has instead been thwarting the health and vitality of the little guys and they want that fixed.

That's what Senators Shaheen and Hassan voted for. 

Responding to inquiry from Mad Dog, Senator Shaheen said, "As with most broad reform legislation, time reveals improvements that need to be made. Main street lenders did not cause the financial cris, but many small banks and credit unions located int New Hampshire were unnecessarily burdened by the Dodd-Frank Act. I have heard directly from many community banks and credit unions in New Hampshire."

So she argues, she was responding to her constituents and as often happens with complex fixes, the fix has to be adjusted later.

O'Rourke says this is poppycock, that both senators have received money from the banking industry and that's why they voted to change the law.They were bought off.

Looking on line the two biggest contributors to both senators seem to not be banks but something called, "Emily's List" an pro abortion organization. O'Rourke does not argue the senators are pro choice because of this.

The next big contributors to both is something called "J Street" a pro Israel lobby.

Then there are "law firms" and "real estate" which might be banks.

But let's suppose Mad Dog's internet research is wrong and both have received money from the banks. Does that mean we must conclude that money bought their votes on this particular bill?

It is hard to prove the money did NOT buy their votes, but they are getting money from all sorts of sources and what might be banking interests looks small enough that if they never got another cent from them, it wouldn't make a big dent.

What O'Rourke may be saying is that with our current system, we've got legalized bribery.  We give you money. We are banks. Legislation comes up which we tell you is good for us. We expect you to vote our way. We expect a return on investment.

O'Rourke says he won't take money this way and he faults the senators for participating in the game as it is currently played because it looks like their votes were bought, or might have been bought or at least influenced by campaign contributions.

When Hillary Clinton tried to explain those $250K "speaker's fees" from Wall Street firms, she basically said, "Everyone does it and it didn't ever affect the way I voted."

Donald Trump was able to label her "Crooked Hillary" because she could never make that appearance of being bought look like good clean fun. 

Apparently our two senators are in the same position now. O'Rourke is making essentially the same claim Trump made about Clinton: The optics are bad.

But the difference is the magnitude. They got some money, but compared to the money they had coming from other sources, chump change.

Mad Dog really does not believe either Senator is corrupt, or bought. He does believe they responded to the "community bankers" pressure, but isn't that their job?

One man's legalized bribery is another man's redress of grievances.

Barney Frank has said Democrats should not throw the baby out with the bath water. He says senators who voted to amend his law were violating no core principles; they were just trying to survive.

O'Rourke says this has to change. 

Mad Dog suspects both senators have clear consciences about their votes. 
How are you going to run if you don't solicit and receive campaign contributions? But if you do, then how are you going to convince your constituents your vote on legislation was not influenced by the money?


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