When Scott Brown announced on Friday that he will not seek the seat John Kerry is vacating in the U.S. Senate, Republicans immediately became so distraught that you expected Karl Rove to appear on Fox News telling us that it was premature to assume Brown wasn’t running.
The former Cosmopolitan centerfold is virtually the GOP’s only hope of a red Bay State Senate seat.
By Saturday, some Republicans were so desperate that they were floating the idea that Ann or Tagg Romney should run for the seat – even though Mitt lost the state less then three months ago by 23 percent.
Of course, Scott Brown’s brief, ridiculous ascendency to the Senate symbolizes everything that went wrong in the aftermath of the financial crisis.
Brown’s win was called the first victory in the Tea Party wave of 2010.
This oversimplified version of history ignores two central facts. Most of what the Tea Party got credit for was actually achieved by Fox News’ unprecedented decision, as the nation’s most popular cable “news” network, to actually organize on behalf of the Republican Party. Secondly, Brown owed his victory more to a flood of Wall Street cash than to any populist movement.
Though anyone who wonders why no executives are in prison for their role in the financial crisis and how we let the big banks get bigger than ever obviously forgets that the Tea Party movement was used to push Wall Street’s agenda, ensuring no banks or bankers ever suffered any real consequences for shattering the global economy. Without a political movement behind them, Congress and the Justice Department melted before the power of a banking industry that had been bailed out and allowed to continue lobbying without restriction.
Brown seized on the frustration of the worst economy in 50 years by promising to be the 41st vote against giving the rest of the nation Massachusetts’ health care plan. He failed in killing the Affordable Care Act but succeeded in the mission that will make him a very rich man.
Wall Street generally liked Obamacare, which mandates the purchase of a private product for a public good.
They hired Scott Brown to water down Dodd-Frank reforms of the financial system, and that he did.
The young senator used Ted Kennedy’s old seat to singlehandedly weaken one of the most important aspects of Wall Street reform – the Volcker Rule.
This rule limits banks’ ability to speculate in the risky investments that led to the financial crisis. To get his crucial 60th vote, the Senate let Brown rewrite the regulation exactly how the banks wanted it and then continued to shape it in their favor it once it became law.
Simon Johnson, a former chief economist at the International Monetary Fund, said Brown’s efforts led to a “significant loosening of the regulations and absolutely serv[ed] the interests of people who do not want to have meaningful reform.’’
That means Scott Brown let Wall Street write its own “reforms.” That’s what the Tea Party won.
You know what happened next.
Having escaped any consequence for their actions, the big banks kept on playing politics. They didn’t succeed in getting the Consumer Financial Protection Bureau (CFPB) removed from financial reform, but they decided they could use their Republican friends in the Senate to destroy it.
First, they vowed to block the appointment of the woman who created the bureau, Elizabeth Warren, as its director. President Obama instead made Warren his advisor in charge of designing the CFPB. Then Republicans vowed to block anyone the president nominated.
Using his Constitutional power to make recess appointments, the president then appointed former Ohio attorney general Richard Cordray, who was known for his willingness to pursue the big banks, to lead the CFPB. And Elizabeth Warren went on to defeat Wall Street’s hero Scott Brown in one of the nation’s most expensive Senate races.
Now Cordray needs to be re-nominated and Republicans are vowing to block him – and anyone the president nominates. Instead, they want to warp the bureau in three significant ways.
They want to take away the CFPB’s independence and make it report to Congress; they want to limit the financial institutions it can regulate, and change its leadership from a director to a board, to limit its effectiveness.
As the Republicans continue to weaken any consequences, regulation or oversight of the big banks, consider the argument right-wingers often make about why the financial crisis happened: Dumb, greedy people took on loans they couldn’t afford because the government was making the banks give out too many loans.
If this fallaciousness had any truth to it (it doesn’t), wouldn’t informing consumers about bad loans and making sure they didn’t take them be essential to preventing another crisis? That’s exactly what the CFPB does. And Wall Street wants to make sure they can’t do it effectively because it may limit their ability to profit off the vulnerable.
Why can they still get away with this, even with Elizabeth Warren now in the Senate?
Well, as Dick Durbin said, the big banks “own the place” because every senator who votes for the banks is assured a very prosperous post-Senate career, as Scott Brown will enjoy… if he doesn’t run for governor.
Still, Ms. Warren and Mr. Romney remind us that Wall Street doesn’t always win, which is a lesson the big banks don’t care to remember.
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