Tuesday, April 19, 2016

Hillary Clinton's push for Wall Street accountability and responsibility - then and now

"Hillary Clinton wanted to regulate Wall Street before the crash and has concrete plans to do it now." That's the title of a Daily Kos article.

Prior to Wall Street Ponzi scheme crashing the economy, few people understood what was happening. One of them, according to this article in Daily Kos, was Hillary Clinton. I've copied the wrap-up here, but there is more to the history of Clinton's proposals then (to prevent the crash) and now (to prevent another). It's a good read.

BTW: If you are a Bernie supporter, as am I, you should not hit the delete button. There is a reason why so many people regard Clinton as the most qualified. Doing her homework is one. Her deep understanding of policy is another. Read on, but if you have the time, read the full article here.

... most people working on Wall Street had no idea what was going on. That was why so many banks and investors were willing to take the bets against the market made by the visionary outsiders described in The Big Short. Those bets against the market seemed easy money to those betting on the market. And a regulatory review, oversight, and transparency were exactly what was needed. But there was none.

Derivatives packaged from lousy mortgages, further derivatives packaged out of the lousy packages of lousy mortgages, and insurance policies on all of them, were so poorly understood throughout the financial industry itself that the small number of people who did understand them were cashing in. They manipulated everyone else on Wall Street, from bankers to bond rating companies to investors, as well as millions of people on Main Street who owned homes they couldn’t afford. It was a massive Ponzi scheme, and it did inevitably crash the economy. And New York Sen. Hillary Clinton was warning about it and proposing to do something about it.

As Amy Chozik wrote in the New York Times a year ago:

It is easy to forget that for years, Mrs. Clinton weathered criticism that she was too liberal, the socialist foil to her husband’s centrist agenda. Economists in the Clinton administration referred to the first lady and her aides as “the Bolsheviks.”

In Mrs. Clinton’s 2008 presidential campaign, she positioned herself as the populist candidate to the left of Barack Obama on several economic issues, angering some of her Wall Street donors and earning broad support among organized labor and working-class voters.

Advisers have lists at the ready outlining Mrs. Clinton’s calls as early as 2007 to eliminate the so-called carried interest loophole, roll back the Bush-era tax cuts for the wealthy, impose tighter regulations on derivatives and place limits on chief executives’ compensation.

And while she now is caricatured and demonized for having taken donations from an industry she actually proposed to regulate before the crash, she now is again proposing regulations that would prevent another one. It’s little wonder that so many who actually pay attention to the details of policy respect her proposals (particularly her focus not only on banks but also on broader markets such as insurers) and her capital requirements, which would force financial institutions to be able to cover the costs of their own risks. Those praising Clinton’s proposals include populist Sen. Sherrod Brown, the Roosevelt Institute’s Felicia Wong and Mike Konczal, Brandon Garrett, and Paul Krugman.

No one would pretend that Hillary Clinton is perfect, but she is a wonk’s wonk who understands policy to a degree rarely matched in modern politics. She identifies problems, delves into the details to understand them, and makes concrete proposals to fix them. She is caricatured because caricatures are easy and slogans are simplistic, but complex policy is neither—and neither is Hillary Clinton.

No comments:

Post a Comment