May 19, 2012

Goldman Sachs Is Paying Dick Gephardt’s Lobbying Firm To Weaken Financial Regulations

Goldman Sachs Is Paying Dick Gephardt's Lobbying Firm To Weaken Financial Regulations
Gephardt swore an oath to the Constitution, but Goldman Sachs pays more.

Rolling Stone’s Matt Taibbi released a new article last week where he laid out how Wall Street is at work undermining the toughest provisions of the Dodd-Frank financial reform law passed last year. Taibbi writes:

The fate of Dodd-Frank over the past two years is an object lesson in the government’s inability to institute even the simplest and most obvious reforms, especially if those reforms happen to clash with powerful financial interests. From the moment it was signed into law, lobbyists and lawyers have fought regulators over every line in the rulemaking process. Congressmen and presidents may be able to get a law passed once in a while – but they can no longer make sure it stays passed. You win the modern financial-regulation game by filing the most motions, attending the most hearings, giving the most money to the most politicians and, above all, by keeping at it, day after day, year after fiscal year, until stealing is legal again. “It’s like a scorched-earth policy,” says Michael Greenberger, a former regulator who was heavily involved with the drafting of Dodd-Frank. “It requires constant combat. And it never, ever ends.”

Greenberger’s quotation is very important. Any law passed by the U.S. Congress only works if regulators make sure it is well-implemented. Wall Street is fighting very hard to make sure that doesn’t happen — which will likely lead to more catastrophes like JP Morgan’s stunning multi-billion dollar loss recently.

In order to win these regulatory fights, Wall Street has to enlist well-connected lobbyists, often former government insiders, to overwhelm federal regulators. Lobbying disclosures released last month show that one of the most nefarious megabanks — Goldman Sachs — has enlisted none other than the firm of former Democratic Party House Minority Leader Dick Gephardt.

Disclosures show that Janice O’Connell — herself a beneficiary of the revolving door, having formerly worked for Sen. Chris Dodd (D-CT), the chief Senate author of the Dodd-Frank bill — of Gephardt’s firm was paid $30,000 lobbying the federal government on the implementation of the financial reform law.

When Gephardt launched his failed bid for the presidency in 2003, he explained why he was running for office:

“My dad was a milk truck driver, a proud member of the Teamsters. My mother was a secretary.  Neither of my parents finished high school.  They didn’t have much money.  But they saved what they could – five, ten dollars a week – so I could get an education and live out my dreams.  I want to dedicate this day to my mother Loreen and my late father, Lou Gephardt.  This campaign is for them — and for all who seek and strive to do right by their kids.  They’re the true American heroes; they’re the people I’m fighting for.

It seems like Gephardt has put aside the interests of truck drivers and secretaries like his parents. Goldman Sachs pays better.