New York Times
updated 4:06 a.m. CT, Sun., May 23, 2010
WASHINGTON - Last Wednesday, Representative David Scott, Democrat of Georgia, mingled with insurance and financial executives and other supporters at a lunchtime fund-raiser in his honor at a chic Washington wine bar before rushing out to cast a House vote.
Nearby, supporters of Representative Michael E. Capuano, Democrat of Massachusetts, gathered that evening at a Capitol Hill town house for a $1,000-a-head fund-raiser. Just as that was wrapping up, Representative Peter T. King, Republican of New York, was feted by campaign donors at nearby Nationals Park at a game against the Mets.
It was just another day in the nonstop fund-raising cycle for members of the House Financial Services Committee, which has become a magnet for money from Wall Street and other deep-pocketed contributors, especially as Congress moves to finalize the most sweeping new financial regulations in seven decades.
Executives and political action committees from Wall Street banks, hedge funds, insurance companies and related financial sectors have showered Congressional candidates with more than $1.7 billion in the last decade, with much of it going to the financial committees that oversee the industry's operations.
In return, the financial sector has enjoyed virtually front-door access and what critics say is often favorable treatment from many lawmakers.
But that relationship, advantageous to both sides for many years, is now being tested in ways rarely seen, as the nation's major financial firms seek to call in their political chits to stem regulatory changes they believe will hurt their business.
The biggest flash point for many Wall Street firms is the tough restrictions on the trading of derivatives imposed in the Senate bill approved Thursday night. Derivatives are securities whose value is based on the price of other assets like corn, soybeans or company stock.
The financial industry was confident that a provision that would force banks to spin off their derivatives businesses would be stripped out, but in the final rush to pass the bill, that did not happen.
The opposition comes not just from the financial industry. The chairman of the Federal Reserve and other senior banking regulators opposed the provision, and top Obama administration officials have said they would continue to push for it to be removed.
And Wall Street lobbyists are mounting an 11th-hour effort to remove it when House and Senate conferees begin meeting, perhaps this week, to reconcile their two bills. Lobbyists say they are already considering the possible makeup of the conference panel to focus on office visits and potential fund-raising.
Link to make your blood boil
Grandpa: Wall Street and congress continue their chummy and incestuous relationship with complete disregard for what is in the best interest of our children and grandchildren. Might BP's dispersant have an alternative application with a positive effect on Wall Street lobbyists and congressional members?
Dispersant Secondary Feature
The dispersant effort is meant to break down the chumminess so that over time, the slick congressional members and lobbyists are reduced to smaller particles that biodegrade instead of being left as clogging, thick globs that can choke off true financial reform on behalf of our kids and grandkids.
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