When Khrushchev denounced Stalin, it sent a powerful jolt through the Russian political firmament, a jolt that eventually led to the dismantling of the Soviet Union and the eclipse of Russian communism. As I pointed out yesterday, the political elites repaid Khrushchev by banning his corpse from a Red Square resting place and banishing it to the less prestigious-- in Communistic minds at least-- to Moscow's storied Novodevichy Cemetery. It's unlikely to be as earth-shakingly consequential, but the long overdue rousting out of corruption-in-politics icon Debbie Wasserman Schultz, on the eve of the Hillary Clinton convention, may have major consequences for the Democratic Party.You probably recall that one of the instances of Wasserman Schultz's authoritarian decision-making that turned the party's grassroots against her, was diktat-- likely at Hillary's urging and Obama's condescension, reintroducing lobbyists into the upper echelons of DNC power. In a world, like Wasserman Schultz's and most Beltway hack politicians', where corruption is an integral part of the status quo, Obama's banning of lobbyists 7 years ago was looked upon as something outrageous that would have to be dealt with by someone less reform-minded, someone like Hillary Clinton. Let me remind you of this chart that helps define American political corruption since 1990:Public Citizen and several other good government reform groups, all of whom are no doubt celebrating the downfall of Wasserman Schultz, were also celebrating reforms the Democratic Party platform is incorporating this week. "We will," the platform states, "crack down on the revolving door between the private sector-- particularly Wall Street-- and the federal government. We will ban golden parachutes for those taking government jobs. We will limit conflicts of interest by requiring bank and corporate regulators to recuse themselves from official work on particular matters that would directly benefit their former employers. And we will bar financial service regulators from lobbying their former colleagues for at least two years." That may not seem like enough to a sane, rational person but it's a giant step away from the world that Debbie Wasserman Schultz, Rahm Emanuel, Steny Hoyer, Joe Crowley, Jim Himes and Chuck Schumer have created inside the Democratic Party as they turned it into a cauldron of corruption to match the cauldron of corruption presided over by the likes of Mitch McConnell, John Conyers, John Boehner, Paul Ryan and Eric Cantor. (Note: the GOP was quicker to get rid of their human sewage-- at least in terms of Boehner and Cantor-- than the Democratic Party has of theirs, this week's Debbie dénouement notwithstanding.Public Citizen contends that "the platform gets to the root of a critical problem in America: Wall Street’s capture of the financial services agencies charged with regulating it. Inappropriate corporate influence at the highest levels of government is not compatible with protecting Main Street Americans, the groups maintain."Richard Trumka, president of the AFL-CIO, has been in the forefront of this fight to reform government (and the Democratic Party). "We applaud the DNC platform for its commitment to ban government service golden parachutes and limit conflicts of interest by Wall Street regulators," he told the media. "Government service golden parachutes are backdoor bribes to future government officials. They should be illegal-- plain and simple. We strongly support Senator Baldwin’s and Representative Cummings’ Financial Services Conflict of Interest Act. As long as the practice remains legal, we intend to keep pushing as shareholders to ban government service golden parachutes at the Wall Street banks."Lisa Gilbert, director of Public Citizen’s Congress Watch division, was as excited as Trumka. "We are thrilled," she said, "that the DNC platform took this landmark stand on the issue of personnel-- recognizing the inextricable link between who runs our banking regulators and how tough we are on Wall Street. Closing the rapidly spinning revolving door between government and industry and doing away with conflicts of interest are a necessary step the next administration must take to start repairing trust in government."It certainly lays out a standard that Democrats need to hold the Clinton administration to over the next 4 to 8 years, a standard, there is every reason to believe, that will not come naturally to Clinton world. Still, Max Stahl, director of political engagement at Democracy Matters, was effusive: "We thank the Democratic Party for taking steps to realign the incentives of our government by closing the revolving door between representing elected power and representing industry. The platform language is a great first step and is a testament to the electoral power of democracy-driven messaging. However, it is vitally important that this platform leads to action. Democracy Matters students across the country will be watching." They'll need to be-- closely. Kurt Walters, campaign director of the Rootstrikers project at Demand Progress, didn't mince words or make nicey-nice.
The platform’s strong language on shutting down the revolving door is a dramatic turnaround for the Democratic Party. Still today, multiple agencies in the Obama administration are run by individuals who took millions in golden parachute bonuses from Wall Street for joining the government. Now, the official position of the Democratic Party is that those golden parachutes should be prohibited; cutting off a major way Wall Street works to rig the rules in its favor. We look forward to applying these standards during the transition to the next Democratic administration."
How serious a problem is this likely to be in a Hillary Clinton administration? Well, keep in mind that the Financial Sector (i.e., the banksters who hated Franklin Roosevelt so much that they tried financing a coup d'état against him) has written Hillary Clinton $47,519,521 worth of checks. Ben White penned a post for Politico yesterday, Wall Street Takes A Road Trip To Philadelphia, that makes you realize their bad behavior isn't being reported on by Chuck Todd and the other TV anchors, who would rather talk about angry, rowdy Bernie Sanders delegates. "Wall Street," wrote White, "is taking the Acela down to Philadelphia this week. Hordes of industry executives will descend on the city to celebrate Hillary Clinton’s nomination for president and renew close associations that vexed the Democratic standard-bearer throughout her primary battle with Bernie Sanders.
Goldman Sachs, which paid Clinton millions for private speeches, will be well represented in Philadelphia with executives Jake Siewert, a former Bill Clinton press secretary, making the trip along with Steven Barg, Michael Paese, Joyce Brayboy and Jennifer Scully, who was a major fundraiser for Bill Clinton in New York in 1992.Blackstone, one of the nation’s largest private equity firms, will hold an official reception in Philadelphia on Thursday featuring its president, Tony James, sometimes mentioned as a possible Treasury secretary in a Clinton administration.Hedge fund managers and top Democratic donors including Avenue Capital’s Marc Lasry and Boston Provident’s Orin Kramer will also be on the scene, as will Morgan Stanley executive and former top Clinton aide Tom Nides. Executives from Citigroup, JPMorgan Chase and other large banks will also prowl the streets and barrooms of Philadelphia.The financial contingent will be in an especially good mood following Clinton’s selection of Virginia Sen. Tim Kaine as her running mate. Kaine has shown a willingness to fight for regional bank relief from the Dodd-Frank financial reform law. But more than that, he’s not Elizabeth Warren, the potential VP pick that long had Wall Street terrified.Republicans with ties to the financial industry will also be there, a sharp contrast to Donald Trump’s convention in Cleveland, which Wall Street largely shunned over fears of the GOP nominee’s populist agenda on trade, immigration and Wall Street reform....Wall Street groaned as Clinton moved to the left during the primary-- especially on trade-- but the industry remains far more comfortable with the idea of another President Clinton in the White House than a President Trump.“I think she has shown, perhaps ironically, that she has a better understanding of business and Wall Street than Donald Trump does,” said Steve Rattner, an investment banker and Democratic donor who will make the short Acela ride to Philly. “The GOP platform includes reinstating Glass-Steagall. And when you watched that [Trump acceptance] speech, Bernie Sanders could have given half of it. Putting partisanship aside, most of my Republican business friends are appalled at the thought of Donald Trump in the White House.”So while the Clinton camp won’t boast about it, given the continuing unpopularity of Wall Street and the populist tilt of the electorate, the City of Brotherly Love will be the City of Banker Love this week. The Clinton campaign did not respond to a request for a comment.Trump is likely to try to continue to exploit Clinton’s connections to the banking industry. On Saturday, following the Kaine selection, Trump tweeted: “Tim Kaine is, and always has been, owned by the banks. Bernie supporters are outraged, was their last choice. Bernie fought for nothing!”Bankers supporting Clinton insist it’s not because they expect favorable treatment from her administration. Indeed, they note that she has staked out tough positions so far including supporting a Department of Labor rule hated by the industry that would put tougher restrictions on investment advisers. She’s also pushed for a tax on some kinds of high-frequency trading and for reinstating a Dodd-Frank rule that banks despise and spent millions of dollars trying to repeal that would force them to move derivatives trades into separate units.“Wall Street doesn’t really side with a party based only on where regulation is going. We live in an environment where we know there is regulation and that we are under scrutiny,” said Robert Wolf, an investment banker and major Democratic fundraiser who will be in Philadelphia. “The bottom line is that if the economy does better, finance does better and everyone does better.”But progressives, already dispirited by the Kaine selection, will be watching the Philadelphia convention closely and continue to resist any efforts by Clinton to stock a potential administration with Wall Street insiders....In some ways, Philadelphia will reveal the delicate dance Clinton has to do with the ascendant progressive wing of the party and the still-critical Wall Street donor base. On stage, the left will be heavily represented with prime-time speeches from Sanders and Warren.But in the background, the “Rubin wing” of the Democratic Party, named for Wall Street executive and former Bill Clinton Treasury Secretary Robert Rubin, will be circulating through panel discussions, Democratic party committee events and cocktail parties.Larry Summers, a Harvard professor and former Rubin protégé who also served as Treasury secretary under Bill Clinton, will take part in a Politico discussion on the economy on Wednesday along with Neera Tanden, a close Hillary Clinton adviser and president and CEO of the Center for American Progress, a think tank some on the left now view as too centrist.Progressives will be prowling around these events, looking to push back on anything they consider too pro-free trade or soft on banking regulation. But at least some on the left say they believe anyone looking for signs of a Rubin-wing restoration in Philadelphia will go away empty-handed.“Clinton’s positions as they have evolved over the last year show she is not going to be soft on Wall Street,” said Dennis Kelleher, CEO of financial reform group Better Markets. “She’s for restoring the [derivatives reforms] and closing loopholes in the 'Volcker rule,'” which limits banks’ ability to engage in risky trading and investment. “She’s not going to deliver for Wall Street like some people fear, and her nominees are going to be decidedly not weighted to finance.”Indeed, one senior lobbyist for a large bank said Wall Street executives going to Philadelphia in hopes of eventually playing a big role in a potential Clinton administration are fooling themselves. “She’s going to start her administration by picking a big fight with the left and nominating a bunch of Wall Street people?” the lobbyist said. “That’s crazy. It’s never going to happen.
