Ugh. Okay, still …
In a letter co-signed by 15 other Senate Democrats — and every Senate Republican — Kaine asked the Consumer Financial Protection Bureau to exempt community banks and credit unions from many of its regulatory requirements. In justifying these exemptions, the letter suggests that these regulations would make it more difficult for these small banks to continue “spurring economic growth” and that such rules are unnecessary, anyhow, since community banks “were not the primary cause of the financial crisis.”
This latter point is a bit of non sequitur. Just because a reckless activity was not the “primary cause” of the last global economic crisis doesn’t mean that activity isn’t worth preventing. According to the Intercept’s David Dayen, the rule Kaine proposes “could allow community banks and credit unions to sell high-risk mortgages or personal loans without the disclosure and ability to pay rules in place across the industry.” Such bad loans may not take down our financial system, but they could ruin the lives of the families that receive them.
In a second letter to the Federal Reserve, Federal Deposit Insurance Corporation, and the Office of the Comptroller of the Currency, Kaine and his co-signers argue that large regional banks like PNC, BB&T, and SunTrust should be exempt from two regulations meant to reduce their risk of collapse.
Currently, these banks are required to issue daily reports about their levels of liquidity, so as to assure the government that they hold enough assets to cover a 30-day period of financial stress. Kaine and 69 of his colleagues would like to exempt regional banks from this requirement, regardless of their size.
Kaine would also like these banks to be exempted from the “advanced approaches” capital requirements that dictate the ratio of reserves a bank must hold to cover potential losses. At present, any bank that holds $250 billion in assets is deemed systemically important and thus subjected to these requirements. Kaine argues that this threshold is too low, in light of the fact that the financial sector has grown substantially since the rule was written. Since regional banks “do not share the same risk profile or complexity as their larger, systemically important brethren,” the letter writers argue, they should not be forced to comply with the same regulations. But it’s not clear why the signatories believe that the collapse of a large regional bank wouldn’t create significant ripple effects in our deeply interconnected financial system.
While Kaine stepped up to the plate for banking interests this week, he simultaneously snubbed consumer-advocacy groups. On Wednesday, Kaine was one of 13 Democratic senators to withhold his signature from a letter authored by Sherrod Brown, which called for strengthening new rules against abusive payday lenders. The senator’s office told the Huffington Post that he is “working on his own separate ‘Virginia-focused’” letter on payday lending.
— Clinton VP Favorite Just Gave the Left Two More Reasons to Distrust Him, Eric Levitz, New York magazine, yesterday (H/T Naked Capitalism)
An article I read late last night (I can’t remember where) said Clinton had been leaning toward Kaine partly because she thinks he will help her win votes of white men because he is originally from the Midwest and is, well, a white man.
That concerned me, because it suggests that Clinton sees white men as somewhat fungible: What matters is the region of the country he hails from and the fact that he is white and male. But this election season has shown rather clearly that there are two distinct types of populism, one far more important in the South than elsewhere, the other far more important in the Midwest and the Northeast—respectively, the racial and xenophobic white-grievance mania that Trump has promoted so successfully, the other traditional economic-populism issues of the sort that Bernie Sanders and Elizabeth Warren have come to represent in the minds of so many voters.
The article I read last night also reported, and the New York magazine article also says, that Bill Clinton had been pushing strongly for Kaine. This too concerns me. Bill Clinton remains ossified in the ‘90s; there has been indication upon indication of that in the last year. He makes Hillary Clinton look observant of the current political climate. Hillary Clinton spent the last year and a half until roughly three weeks ago seemingly unobservant of the current political climate—the very morning after the California primary, when she effectively secured the nomination, she was on the phone to moderate Republican donors, apparently on the assumption that they couldn’t figure out for themselves that if they couldn’t abide Trump they should support her, since she’s the only actual alternative. So Bill Clinton’s feat is notable.
And Hillary Clinton’s decision to choose Kaine suggests what I, and I know many other progressives, fear: that she is manipulated by her husband to an unnerving extent.
I’m on a listserve of Sanders supporters whom the Clinton campaign occasionally targets with messages from Clinton promising to be a progressive president, and last night I received a message titled “Welcome Tim Kaine”. It begins by assuring that she and Kaine both are genuine progressives. The rest of the message is, I assume, the message she sent to her supporters announcing her choice of Kaine. What caught my attention was something that also caught my attention when I read his Wikipedia page last night before posting this post (and titling it as I did): Kaine graduated from Harvard Law School and then practiced law in Richmond.
Why Richmond? I wondered when I read the Wikipedia entry, which doesn’t answer that question. Kaine had no ties to Virginia. And, it hit me, after graduating from Harvard Law he didn’t work for the government and didn’t work for a corporate mega-firm. Yet he did practice law. That’s really important. (Trust me. It is.)
In her email, Clinton details this. After graduating from Harvard Law School, Kaine moved to Richmond to litigate against that city’s pervasive racial discrimination in housing. He practiced law there, in Richmond, for 17 years. Just ordinary law, I guess (although Clinton doesn’t say); not law of the corporate variety, I presume.
This matters. But not as much as, I fear, Clinton thinks. Economic populism matters right now in domestic policy, beyond all else.
I can’t emphasize enough that there is, I’m pretty sure, nothing that would cause me to not vote for this ticket. But I’m a single vote. And the way to win the votes of enough white men in Midwestern swing states is run on the progressive economic policy platform that so largely reflects Sanders’ and Warren’s policy prescriptions, if not enough. It is not to rest on the belief that a majority of voters want experience and steadiness. And that a majority of white men in swing states care mostly about whether or not the candidate has chosen a white man as her running mate.
____
UPDATE: I want to really emphasize my point above that Bill Clinton apparently is having disconcertedly undue influence over Hillary in critical respects. I’ve just read more about Kaine’s time as governor, and while these essentially Republican actions and positions he took may well have been necessary in order to enable a potentially successful Senate run, this is not a candidate who should be the Dem VP nominee, least of all in this election cycle.
As I say above, I was just dismayed when the very morning after the California primary, Hillary Clinton was on the phone soliciting contributions from moderate Repub donors. But in thinking about this today, I realize that this probably was at Bill’s elated suggestion. This is NOT good–this retro chokehold on the current nominee.
Added 7/23 at 12:47 p.m.
” At present, any bank that holds $250 billion in assets ….”
Kaine lobbied by Capital One?
Company Name Total Assets ($000) More Info
JPMorgan Chase Bank, National Association $1,971,380,000 Details >
Bank of America, National Association $1,606,232,000 Details >
Wells Fargo Bank, National Association $1,553,871,000 Details >
Citibank, National Association $1,336,201,000 Details >
U.S. Bank National Association $414,002,247 Details >
PNC Bank, National Association $343,630,072 Details >
The Bank of New York Mellon $320,204,000 Details >
State Street Bank and Trust Company $289,425,299 Details >
Capital One, National Association $255,291,411 Details >
TD Bank, National Association $235,029,604 Details >
HSBC Bank USA, National Association $190,499,714
http://www.managingmoney.com/fdic_assets.php
I pick on Capital one as it’s based in Northern VA.
Welcome to AB. First responses always go to moderation. You are free to post now.
Thanks for sharing this article about Kaine. I am more informed, and a bit concerned too. In light of the fact that he was a serious veep contender he should not have signed on to the regional bank thing unless it was important to make this positioning point.
Community level type banks are governed by common sense in their use of the bank money privilege (the privilege to create credit out of whole cloth). I think the evidence is good here to say that differential approaches are very sensible, tied to the reality of their community.
But so called regional banks? They need to be overseen because they are once removed from being in a local community, and enough size where their credit creating magnitudes can influence widely.
So good to see some skepticism here.
Thanks.
Thank you for this comment.
“As I say above, I was just dismayed when the very morning after the California primary, Hillary Clinton was on the phone soliciting contributions from moderate Repub donors.”
I guess I’ll repeat myself once again. When will it be recognized that the Clintons are founding members of the Democratic Leadership Council, that group of Democrats that branded themselves as free market directed and less focused on left of center economic issues. Just read Wiki on DLC or Bill Clinton and note that the description fits like a glove on the hand of a moderate Republican. The Clintons and the entire leadership of the DNC since 1985 has been little different from corporate spokes people and able to use a sightly more progressive stance on social issues in order to distinguish themselves from the Republican Party which was becoming increasingly and radically right wing on those very social points.
We no longer have a viable left of center major political party. The people have satisfied themselves with crumbs from the economic pie and we’ve ended up with not one economy with widely divergent income levels, but two distinct economies with maybe 10 to 15 percent of people earning enough to be happy in one mode of our bi-modal income spread. The other 85% are the poor who have to scrape to get by and be satisfied with their dreams, and those dreams are either social, religious or economic in nature. The two groups over lap just a little in the social and religious spheres.
So unless there is some form of social upheaval in the future we are stuck with the corporate America that feeds the political class and throws out crumbs to the prols. Clinton and Kaine are only symptoms of
how Americans see themselves. No, its not a pretty picture to a more genuinely progressive point of view, but Trump and his ilk are the alternative and the proof of the circumstance. I’d be curious to know if early revolutionary America, say within the first three administrations, had any one like Trump at the front of the pack of a viable political group.
Jack, what dismayed me was the sheer stupidity of doing that–and at the very moment she secured the nomination, after campaigning aggressively in California as an economic progressive–given that (1) it was sure to get out, and (2) any moderate Repub donors who would prefer Clinton to Trump already knew their donations would be accepted, and didn’t need Clinton to woo them. Unless, of course, she was making specific promises to them about specific policies–which if these people really fear and detest Trump, she didn’t have to do.
I’m well aware of who the Clintons really are, Jack. I need no reminders. But … geeeez …the in-your-face carelessness and, just, stupidity.
Speaking as a middle aged white male who happens to be from Virginia and supported Sanders in the primaries, though I wasn’t likely to vote for Clinton anyway her selection of Kaine make that even less of a possibility.
Like his fellow centrist Democratic colleague, Mark Warner, Kaine has done NOTHING for Virginia since his election to the Senate. He is yet another neoliberal careerist with no core values, and as far as I’m concerned both he and Clinton can go to hell.
Much as I agree with you regarding centrism, it breaks my heart that you and others who feel the same so strongly won’t vote for this ticket in a swing state.
I know so painfully what the Conservative Legal Movement whose 30-year chokehold on the federal courts is only now finally dissipating has done to almost everything I care about politically. Most people think all they deal with is culture-wars issues. I know what they really deal with, and how they deal with it.
I also know that Paul Ryan’s fiscal/regulatory plan, which Trump will sign, will devastate many millions of vulnerable people. The issue of mass sale of federal lands or handing them over to the states is an issue–although almost no one knows this.
The harm to the environment would be profound if Trump and Pence win. Al Gore’s phrase “Earth in the Balance” is true here.
There would be mass–mass–deregulation of the finance industry and many, many other industries.
And then there is the genuine possibility of fascism–of misuse of the Justice Department, the IRS, the FBI, the CIA.
So I hope you and others who feel so strongly now that they can’t vote for this ticket will have a change of heart, maybe just at the very last minute. At least those who, like you, live in a swing state.
Community and Regional banks tend to go “Democrat” and Democrats know that they need their support in the election, especially since Wall Street and Democrats have faded back to pre-90’s relationships.
Politics is politics.
oboy.
Look, I think the letter regarding the Capital Ones of the world was a bad idea. While not as important as the big boys, they need to be kept on a tighter leash than the community banks. Maybe once a day is a little much, but once a month is not enough.
But this attack on the letter regarding these community banks is silly(and Dayen continues to say things that are beyond the truth) . I am not a fan of his writing as he sees smoke and spreads it around and then says
“A rule of this type could allow community banks and credit unions to sell high-risk mortgages or personal loans without the disclosure and ability to pay rules in place across the industry.”
That is not a true statement unless “could” means “can”. What Dayen refuses to talk about is that everyone of these banks are also subject to state regulators(I guess he forgot that), unlike national banks. To make something of this second letter is to just take some little bit of smoke, spread it around and have the uneducated get upset.
He has does, particularly in Obama selling out to get the public option out of the ACA. Sheer and utter garbage, but people listen to him. I cannot imagine why.
Meanwhile, why is anyone concerned about the VP’s attitude towards bank regulation? The VP has absolutely no control over it at all, and even the POTUS has fairly little.
Congress makes legislation.
Why is this simple fact so hard for people to understand?
First of all, the systemic importance isn’t all the matters. Apparently one of the letters asks for deregulation of the forthrightness with which the terms of a mortgage must be disclosed and made clear. That’s critical, if not to the economy as a whole, certainly to many families. Could clearly means would, if interpreted by the regulatory agency to allow it.
Second, Obama never tried to get the public option; he never bothered to speak to the public about it. Had he done so he probably still couldn’t have gotten it through because of Lieberman and Baucus. But he didn’t try, and because he didn’t try, it never became a political issue.
Third, I love David Dayen.
Fourth, the executive branch plays a huge rule in such things as banking regulation; it’s the branch that controls all the regulatory agencies that write the regulations authorized by or required by the legislation.
Fifth, the VP on occasion becomes president.
Sixth, and most relevant, the VP choice is seen as a proxy signal for which direction the presidential nominee wants to run if elected.
Seventh, you’re getting on my nerves. I don’t like you anymore. So there.
See what happens Bev?
Now your incessant rants have brought people out of the woodwork that should not be let out of the woodwork.
Whom do you have in mind?
Regional banks tent to go democratic?
Really?
I was in banking for thirty years, I missed that.
Kaine did nothing as governor? I seem to have missed that also.
It will get worse. And that is hard to do.
The election of any Republican to POTUS is a disaster that the US cannot afford. And that would be without Trump.
In the last two decades this party has morphed into sheer evil, from local to state to federal levels.
Anything anyone does that helps the Republican candidate for President is beyond stupid, and evil.
You want another Scalia or two on the Supreme Court?
That would be the end of the progressive movement for a couple of generations. Yet somehow people are upset about the VP pick and threatening to not vote.
Beyond scary.
Bev,
Your reply at 4:54.
Of course you love Dayen, he is a BernieBro. And I love the idea baout Obama not trying. Yeah, yelling louder is an effective leadership skill. Course, I am confused how that thought process works when there was actually a bill passed in the House that contained a public option. And was killed because of Liebermann. What could Obama have possibly done to put pressure on him? Nada. Wasted green lantern thinking.
I missed the proxy signal provided by Biden.
Sorry you feel that way. I feel in necessary to hold people accountable for their actions. In the past(think 2000), things like this current obsession has caused immeasurable harm to the country. It is threatening to do it again. And the people most responsible for the damage will blamed the neoliberals.
It is what they do. It is why liberals are the worst team mates in the world. Like herding cats. Stupid cats.