The United States is a two-party system consisting of Republicans and
Democrats. While other parties exist, and independents as well, they do
not have sufficient funds or support to challenge the two main parties.
The Democrats are supported by most in the US who
consider themselves liberal or leftist. Most of these supporters are
well aware of the fact that Wall Street has a huge influence on policy
through donations and lobbying even when the Democrats are in power.
Many liberal policies were not implemented even when the Democrats
controlled both houses of Congress, for example the long-promised
closure of Guantanamo Bay. In order to prevent liberals and leftists
from leaving the Democrat fold, shepherds or shepherdesses are needed to
herd them back into the fold rather than leaving and perhaps even
forming another party. Elizabeth Warren can be seen as playing this role
and doing an excellent job.
In a
recent article
in the Huffington Post, "Enough is Enough, The President's Latest Wall
Street Nominee", Warren lambastes Obama's choice of Antonio Weiss as his
nominee to serve as Under Secretary for Domestic Finance within the
Treasury Department. He would be responsible for overseeing Dodd-Frank
implementation, and also a wide range of banking and economic
policy-making, including protection of consumers.
Warren points out that Weiss is head of global investment banking at the large financial institution
Lazard.
Weiss has worked most of his two decades with Lazard on international
mergers and acquisitions. Indeed he spent 8 years living in Paris.
Warren claims his experience is in no way related to domestic finance,
regulatory issues, or consumer protection.
Warren points out also the Weiss has been involved through Lazard in
corporate inversions whereby foreign companies. As Warren puts it:
Basically,
a bunch of companies have decided that all the regular tax loopholes
they get to exploit aren't enough, so they have begun taking advantage
of an even bigger loophole that allows them to maintain their operations
in America but claim foreign citizenship and cut their U.S. taxes even
more. No one is fooled by the bland words "corporate inversion." These
companies renounce their American citizenship and turn their backs on
this country simply to boost their profits.
Warren claims that Lazard has been involved in three of the four
last major corporate inversions. Weiss worked on the deal which saw
Burger King purchase Tim Horton's and then moving the headquarters to
Canada to claim Canadian ownership and cut its tax bill. Lazard even
moved its own headquarters to Bermuda in 2005 to take advantage of a tax
loophole. The loophole was closed shortly afterwards. Even officials at
the Treasury Dept. during the Bush administration found what Lazard was
doing objectionable.
The White House has said that Mr. Weiss was not involved in the tax
side of the Burger King deal. Warren rightly replies surely when she
claims that the entire deal was designed to improve Burger King's tax
situation. The White House also claims that Weiss is personally opposed
to inversions. This has never caused him to criticize Lazard for what
they have done or to refuse to help them with inversions.
While Wall Street frets about Obama's policies Warren points out that
the Obama administration has been filled with many representatives of
large financial institutions, including Citigroup. Three of the last
four Treasury secretaries serving under Democratic presidents held
high-paying jobs at Citigroup before joining the government including
former CEO Robert Rubin. As Warren points out, the influence of
Goldman Sachs in Washington is well documented:
It seems that every few weeks, another Goldman Sachs executive goes to
work for a government agency, with bankers landing in positions of power
at the Treasury Department, the Federal Reserve, and pulling the levers
of the massive trillion-dollar federal bailout. At the same time, the
bank, which announced on Tuesday that it was hiring former Securities
and Exchange Commission Chairman Arthur Levitt, has received $10 billion
in TARP funds.
Warren also notes the huge number of lobbyists working for just the six largest US banks:
According
to a report by the Institute for America's Future, by the following
year, the six biggest banks employed 243 lobbyists who once worked in
the federal government, including 33 who had worked as chiefs of staff
for members of Congress and 54 who had worked as staffers for the
banking oversight committees in the Senate or the House.
Warren's criticisms are quite apt. However, so far, she has refused to
run herself to be the Democrat nominee for president. Instead she has
long favored Hillary Clinton who arguably has a lot cosier relationship
with Wall Street than Obama has at present.
In an interview
Warren said: "
All
all of the women — Democratic women I should say — of the Senate urged
Hillary Clinton to run, and I hope she does. Hillary is terrific."
Warren also one among several senators who signed a letter urging
Clinton to run in 2016. Warren has the right rhetoric but makes the
wrong move by supporting Hillary unless the aim is simply to act as a
shepherdess to steer liberal and left support behind Hillary.
Hillary herself has praised and at times
even adopted Warren populist rhetoric:
“I
love watching Elizabeth give it to those who deserve it,” Clinton said
to cheers. But then, awkwardly, she appeared to try to out-Warren
Warren—and perhaps build a bridge too far to the left—by uttering words
she clearly did not believe: “Don’t let anyone tell you that it’s
corporations and businesses that create jobs,” Clinton said, erroneously
echoing a meme Warren made famous during an August 2011 speech at a
home in Andover, Massachusetts. “You know that old theory, trickle-down
economics? That has been tried, that has failed. It has failed rather
spectacularly.”
She later noted that she had gone a bit overboard in claiming that
corporations and businesses do not create jobs. Of course they not only
create jobs if they think they will create more profit, they get rid of
them for the same reason.
Speaking to plutocrats for some reason Hillary changes her tune and tone:
"But
Clinton offered a message that the collected plutocrats found
reassuring, according to accounts offered by several attendees,
declaring that the banker-bashing so popular within both political
parties was unproductive and indeed foolish. Striking a soothing note on
the global financial crisis, she told the audience, in effect: We all
got into this mess together, and we’re all going to have to work
together to get out of it."
