May 18, 2010
Big Bank Lobbyists Fighting Financial Reform Outnumber Pro-Reform Lobbyists by 11-1
New Public Citizen Report Shows Firepower Wall Street Is Bringing to Capitol Hill
WASHINGTON, D.C. – Wall Street is pulling out the stops to get a financial reform bill that changes as little as possible.
Since the beginning of 2009, nearly 1,000 lobbyists have worked on at least one of nine key bills designed to rewrite the rules governing derivatives, a new Public Citizen report shows.
These lobbyists have overwhelmingly represented organizations opposing or attempting to water down proposed regulation, according to Public Citizen’s analysis of lobbying disclosure data filed with the U.S. House of Representatives.
Lobbyists representing opponents of strong derivatives reform have outnumbered pro-reform lobbyists by more than 11-to-1 (903 to 79 lobbyists). Among the clients represented by the anti-reform lobbyists were the nation’s five largest banks, several major financial trade associations and the U.S. Chamber of Commerce.
“Wall Street is fighting hard to keep its casino open for business,” said David Arkush, director of Public Citizen’s Congress Watch division. “They want to keep making risky bets, awarding themselves billions in bonuses and running to Uncle Sam for handouts when they lose. Their position is ridiculous and discredited, so it’s not surprising that they would hire nearly a thousand lobbyists to drown out reform advocates.”
The Senate Wall Street reform bill includes relatively aggressive derivatives regulation approved by the Agriculture Committee. The current draft would push most derivatives trading onto open exchanges or clearinghouses, and would deny federal deposit insurance to derivatives traders. This latter requirement would force commercial banks to spin their derivatives trading operations off into independent companies, although they would be able to remain under the same holding company. Wall Street is lobbying furiously to eliminate or undermine these provisions.
“Lawmakers should mind the advocacy disparity on derivatives and work to give fair consideration to the pro-reform side,” Arkush said. “A small number of organizations are completely outgunned, but unlike like big bank lobbyists, they represent tens of millions of real people.”
The report is available at http://www.citizen.org/documents/DerivativesLobbyistsReport.pdf.
Public Citizen is a national, nonprofit consumer advocacy organization based in Washington, D.C. For more information, please visit www.citizen.org.