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Democrats and Banking
March 22, 2009 - Ray Hall (Archive)
Democrats control all three rings of the Washington Circus and the Obama Administration occupies center ring. I supported Senator Hillary Clinton in the presidential primaries, but voted with equal fervor for Barack Obama in November. However, it was not until the President had been in office for a month that I began to appreciate and believe that Barack Obama was serious about bringing fundamental change not only to Washington but to our country. I still cling to that hope, but with increasing skepticism as majority Democrats attempt to exorcize demons associated with AIG and Wall Street money changers.
The AIG bonus issue shined a bright and embarrassing light on Senator Christopher Dodd (D-Conn) when it was revealed that he, with or most likely without the knowledge of his colleagues, inserted precise language in a piece of legislation that restored nearly $300 million in bonuses to the very AIG employees who got us into this economic mess in the first place. It was bad enough that he denied a consensual relationship that resulted in the birth of the amendment, but the Senator was forced to return the very next day and accept paternity.
Senator Dodd stands for reelection in 2010 and his chances of returning as Connecticut’s Senior Senator is increasingly in doubt. Republicans have already lined up an opponent who will not need to say very much as Senator Dodd tries to explain why he carried water for AIG and Wall Street’ s elite. The Senate race in Connecticut and the efforts of President Obama to fundamentally change America in positive and powerful ways depends on how well Senator Dodd and his fellow Democrats disentangle themselves from cozy relationships they have developed with the banking industry.
A handful of prominent Democrats allowed themselves to become too closely aligned with people whose loyalties are more closely tied to prevailing currencies than a spirit of nationalism. Too many politicians were seduced into believing that it was the mavens of Wall Street and their fanciful financial products that created our economy instead of simply being a financial conduit for Main Street America where the economy is actually created.
Nowhere is that relationship more evident than in the credit card business. MBNA, one of the world’s largest credit card companies is headquartered in Delaware, the home of Senator and now Vice President Joe Biden and is the beneficiary of a benevolent government. As a Senator, the Vice President remained silent as MBNA and other credit card banks were allowed to “jack rates” to unconscionable levels without so much as a shudder from Senator Biden. It is coincidental that the Vice President’s son is and has been an executive for MBNA for a number of years.
Senator Charles Schumer and former Senator Clinton were recipients of thousands of dollars of campaign contributions from the banking industry. It was probably not by accident when new legislation made it nearly impossible for people declaring bankruptcy to escape paying credit card debt. Democrats and Republicans defended that legislation by making the implausible but apparently effective argument that the “rich” should not use bankruptcy to deliberately escape paying their debts.
The reality was that a vast majority of people filed bankruptcy for medical reasons or family tragedies, the loss of a primary breadwinner, or became chronically unemployed. In the matter of bankruptcies, Democrats clearly rejected the poor and the disenfranchised in favor of the mavens of finance. FICO scores, your individual credit rating is another area that came down from the top instead of the grassroots.
It was not that long ago when credit reporting companies were prohibited from using a scoring system to determine a person’s credit worthiness. A company that requested a credit check examined a person’s payment history, late payments and credit balance and made their own determination whether to extend credit. Now, credit worthiness, the FICO scoring system, is based on a score from 499 t o 800 and above. An individual credit score fluctuates, sometimes wildly, between credit reporting agencies and that score determines credit limits and interest rates—the lower the score, the higher the interest rate.
The entire banking system—our financial system, is out of whack and prominent Democrats were part of that betrayal of public trust. I hope President Obama can fundamentally change our country, but his efforts will fall short unless a few prominent Democrats divorce themselves from the financial make believe from Wall Street and influence peddling from K Street.
I hope President Obama succeeds and he can, but Democrats in Washington must perform each in his own circus ring in full public view, openly and honestly under “the Big Top” in our nation’s capitol.
P.S. for danyay: Hugo Chavez? Not a favorite. The man is delusional. Castro overthrew a dictator and Chavez seems to disappointed that he came into office by a democratic ballot.
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