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.