The part that CitiGroup wrote After the 2008 financial crisis, a lot of people were understandably less enthusiastic about derivative trading — A financial instrument that played a major role in the crisis and led to the collapse and $85 billion taxpayer bailout of insurance giant AIG. As Ben Protess of the New York Times explains, Congress used the 2010 Dodd-Frank law to create a requirement that banks push out some derivatives trading into separate units that are not backed by the governments deposit insurance fund. The proponents of the push-out rule argued that it would isolate risky trading from parts of a bank eligible for a government bailout. Since everyone from the Tea Party to Occupy Wall Street was infuriated by the big bank bailouts, youd think Congress would still be taking a victory lap for passing a measure that makes bailout less likely. Instead, theyre using the budget bill to sneakily kill it. The current budget deal includes a repeal of the Dodd-Frank derivatives rule that was literally written by big bank lobbyists — A leaked document obtained by the New York Times revealed that 70 of the 85 lines in the new House bill reflect recommendations made in a piece of model legislation drafted by lobbyists for Citigroup, another bank that played a major role in the 2008 crisis and also received billions of federal stimulus dollars. If all this sounds familiar, its because the House passed the exact same CitiGroup-written law last year, but it died after resistance from the Senate and Treasury Department. Now, Wall Streets allies in Congress have effectively copy-pasted the CitiGroup-approved language out of the old bill and into the current budget deal, which cant be vetoed without shutting down the government. On a completely unrelated note, did you know Wall Street spends $1.5 million per day to buy influence with our government? Looks like their investment is about to pay off.
Posted on: Sat, 13 Dec 2014 14:17:53 +0000
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