Financial Reform and American Politics

The final stages of financial reform is being conducted as a giant game of chicken. Who will blink first? Will it be President Obama and the Democratic leaders controlling Congress? Or, will it be Senate Minority Leader McConnell and his Republican troops? As a lay student of history and politics I find the current political drama over financial reform fascinating and emblematic of our political system.

The financial reform debate in Congress is framed by some interesting backdrop.

President Obama is coming off a sweet and sour victory of winning national health care reform, something that eluded the last hundred years of Presidents. Due to the damaging political controversy the majority of Americans are not totally on board with health reform. Obama’s support has waned from election day until now with slightly less than half of Americans supporting him. But, importantly two-thirds of Americans see him as a strong President. American’s love a winner! (Can Tiger Woods rehabilitate himself by winning golf tournaments?)

Americans whether Tea Party members, Main Street merchants or the vast middle class share a disgust with Wall Street, the financial and industrial titan bailouts and their anger over seeing their houses and retirement accounts shrunk in value. Fifteen Americans that don’t have a job are even more upset and cynical. Confidence in Congress in general is down in the low 20’s nearing a historical all time low point.

Congress and the media have been dragging Goldman Sachs executives and other white collar millionaires from Wall Street who toppled the global economy and helped create the “Great Recession” in a pathetic melodrama. Both Republicans and Democrats berate the titans of Wall Street. The finely dressed dandies of Hedge Funds and Investment Banking firms who send them campaign donations say, “don’t blame us and point the finger at others..” It is clear that greed, double dealing and short term profit taking brought our economy down and are still in play today on Wall Street. There is also plenty of evidence that Wall Street Captains seduced our government into changing the rules over the last twenty years to make it easier for them to make more and more money. The few government regulators left with power to prevent damaging abuses were asleep, told to look the other way or as now revealed watching porno.

The collapse started in 2007 and beyond the bailouts nothing has changed. Our President and Congress know they must do something before the November 2010 elections.

Who will blink? Is this really about policy differences? Will the Republican Minority which can block the vote in the US Senate use their leverage to demand policy changes? Will Obama and Senate Democrats hang tough? Is either side willing to continue the bluff and walk away with no bill?

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One Response to “Financial Reform and American Politics”

  1. Keith Stump Says:

    So we now know that “nothing” was done before the November elections, but we don’t know what will be the effect of what was done during the lame duck session.
    Granted that Wall Street Captains “seduced our government . . . .” but isn’t the seducee equally culpable for copulation. Especially when they “require favors.” I’m thinking of the role played by the social experiment to increase home ownership that was forced on the financial institutions by our Congress.

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