King of the Hill

Though we need to wait until November to find out who the next president will be, we already know who the king is.

That would be JPMorgan Chase CEO Jamie Dimon, who got the regal treatment from the Senate Finance Committee this week when he was called to testify about the disastrous trades that has cost his firm more than $3 billion so far and reduced the firm's market value by $27 billion.

You know, the trades that Dimon originally dismissed as a “tempest in a teapot.”

Which gives you some idea of the teapots that President Obama’s favorite banker can afford. President Obama has particularly close ties to the bank: JPMorgan’s PAC was one of the top donors to his 2008 campaign, offering more than $800,000, and the president’s former chief of staff, William Daley, was a top executive there.

Dimon is equally popular on Capitol Hill. Instead of a grilling him about his failure to take action for months after questions were raised about the strategy surrounding the failed trades, most of the senators treaded lightly.

Instead of scrutinizing the foreclosure fraud and failure that led to JPMorgan’s $5.3 billion share of a $26 billion settlement with state attorneys generals, several senators took the opportunity to offer Dimon a platform to continue his campaign against regulation of Wall Street, including modest reforms like the Volcker rule which many say could have prevented the JPMorgan loss – had it been in place.

For his part, Dimon denied that he knew anything, took some vague responsibility and minimized the losses as an isolated event.

The route to traditional royalty is through birth or marriage. Dimon won his political crown through another time-honored path – he bought it. Most of the senators he faced had benefited from the generosity of his bank’s campaign contributions. As the Nation’s George Zornick reported, the senators had received more than $522,000 from JPMorgan, about evenly split between Republicans and Democrats.

The staff of the Finance Committee and JPMorgan are connected through a web of revolving door contacts. The banking committee’s staff director is a former JPMorgan lobbyist, Dwight Fettig. One of the banks’ top lobbyists is a former staffer for banking committee member Sen. Chuck Schumer, while three of its outside lobbyists used to work for the committee or one of its members.

J.P. Morgan has pummeled Congress and regulators with more than $7.6 million worth of lobbying in an effort to get banking rules written to favor the bank.

The king’s appearance before his subjects on the Senate Finance Committee was a powerful demonstration, for those who still need it, of just how little of the spirit and the practice of real democracy remains in an institution that is supposed to embody it.

If our representatives were truly beholden to us, rather than to Dimon and others with large supplies of cash to dole out, his testimony would have had a starkly different tone.

He has a lot to answer for. So do those who let him off so easy.

And it’s not just Dimon that the senators have failed to oversee. While bankers’ profits are back, the banking system is still broke.

If those senators were serving us, rather than serving as lapdogs to bankers, Dimon and other Wall Street monarchs might be looking at prison cells, not red carpets.

 

Martin Column / Too Big To Fail / Uncategorized - 06/14/2012

President aims to take the money and run

Here’s what President Obama wants you to believe about his relationship to the Supreme Court’s Citizens United ruling and the toxic torrent of corporate cash polluting our politics: “it’s complicated.”

In their ruling, the justices determined that corporations had a free speech right to anonymously contribute as much as they wanted to third-party political action groups that worked in support of candidates, as long as those PACs had no formal connection to the candidate.

On the one hand, the president blasted the court’s ruling less than a week after it was issued, with the justices seated right in front of him, in his January 2010 State of the Union speech, for opening “the floodgates for special interests – including foreign companies – to spend without limit in our elections.”

On the other hand, his campaign decided two years later to “level the playing field” with Republicans and encourage Super PAC support for the president, by allowing cabinet members and senior White House officials to cooperate with a Super PAC that supports their boss.

On yet another hand, the president insisted he would support a constitutional amendment to undo Citizens United.

And on yet still another hand, when the president had the opportunity to actually do something to shed some sunlight on the secretive stash of corporate donations unleashed by Citizens United, by issuing an executive order requiring government contractors to reveal all their political spending, he balked.

When you follow the president’s actions, rather than listen to his words, it’s not complicated at all.

The president and his Democratic Party colleagues are determined to “take the money and run.”

For nearly a year, President Obama had floated the idea of issuing an executive order requiring government contractors to disclose all their political contributions – including contributions to PACs and organizations like the US Chamber of Commerce – when they submit a bid.

The biggest contractors, for the most part, are defense contractors like Lockheed Martin, which smother the politicians in contributions to keep the weapons contracts flowing. In the 2012 cycle, Lockheed’s PAC has spent more than $2 million in contributions that we know of, 59 percent to Republicans and 41 percent to Democrats.

Its contributions go beyond an attempt to win a single weapons contract. What they and the other contractors have been able to do is to purchase the country’s entire debate over defense spending, so that few of our representatives ever raise a peep about whether the expensive defense systems are necessary.

Republicans howled at the President Obama’s proposal, accusing him of attempting to politicize the bidding process. President Obama wanted to know who had made the contributions, the Republicans charged, so he could award bids to the highest-contributing bidders.

While President Obama stewed, the Republicans passed measures in May 2011 to block[m1]  an executive order if it was issued.

The venerable Public Citizen organization made a suggestion that would sidestep the Republicans’ stated objection.

Why not, Public Citizen said, limit the disclosure requirement to the winning bidder?

But the president backed off – either because he didn’t want a fight with Republicans or because his fundraisers reminded him he had a tough campaign ahead and the little people they dote on with their solicitation emails weren’t going to be able to foot the bill.

On the most critical issue facing our political system, the president of the United States is incapable of leveling with the American people.

President Obama may want to do the right thing, but he is trapped in a system controlled by big money that is bigger than he is.

The first step to fight back against that system won’t come from Washington. It will come from building a grassroots movement to undo Citizens United. Read more about it, and our proposed constitutional amendment, which is easy to understand and will withstand any legal challenge, here.

 

 

Citizens United / Congress / Martin Column - 04/13/2012

Etch-a-Sketch Politicians in a PAC Man world

Every once in a while a jaded political operative utters a profound truth, cutting through all the baloney and phony punditry.

That’s what Mitt Romney’s adviser did when he suggested that his boss could just hit “reset” and adopt more moderate positions once he locked up the Republican nomination and didn’t have to cater to the far right of his party. “It’s almost like an Etch-a-Sketch,” the aide, Eric Fehrnstrom, said. “You can kind of shake it up, and we start all over again.”

Sure, all of Romney’s foes will now clobber him with his aide’s comments and try to score political points off the “gaffe.”

But Fehrnstrom was offering a truth that rarely gets told in big media about how our politicians operate.

Romney and his fellow candidates count on voters not to pay attention, to leave them plenty of room to gloss over earlier statements.

Politicians count on the media’s cynicism and its craven need for access to power to blunt any remaining watchdog instincts. The media ignore commitments the candidates make and contradictions between what they do and what they said, shrugging it off because “everybody does it.”

Romney has had to shake the Etch-a-Sketch hard to erase the image of himself as the moderate Republican governor of Massachusetts whose own health care plan provided the template for President Obama’s health care plan, while candidate Romney now falls over himself to oppose the plan.

But the president has his own image shifts to answer for.

For example, candidate Obama portrayed himself as a strong advocate for the 99 percent, promising to change bankruptcy laws to help homeowners facing foreclosure keep their homes.

That shift, known as “judicial cram-downs,” would have provided a powerful incentive for banks to work out loan modifications with homeowners.

But when bankers fought cram-downs, President Obama quietly folded and judicial cram-downs died in Congress. Since then, the president and his administration have offered a series of limp anti-foreclosure measures that rely on voluntary bank cooperation, with paltry results.

But the Etch-a-Sketch is a pretty old toy. The current political season reminds me more of a slightly less retro game that gripped the public imagination – Pacman. In this wildly popular video game, a pizza-shaped icon gobbles up everything else on the screen.

The Supreme Court’s Citizens United ruling unleashes unlimited, anonymous contributions to political action committees, or PACs, aligned, but not formally tied, to specific candidates.

Unfortunately, when it comes to using the PACs to bolster their campaigns, the Republicans and Democrats are on the same page.

Both are eager to gobble up the gazillions of dollars available through the PACs, thoroughly undermining the spirit and practice of democracy, in which the majority, not the super-rich minority, are supposed to win.

The best way for us to shake up the political establishment, and the billionaires and big corporations who control it, is to fight for a constitutional amendment to overturn Citizens United.

Here’s our version of such an amendment, written in language that’s easy to understand and will withstand any legal challenge.

 

 

 

 

 

 

 

Citizens United / Martin Column / President Barack Obama - 03/23/2012