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Why No One’s Going to Drain this Swamp

Discussion in 'Politics Forum (Local/National/World)' started by Scorpio, Mar 14, 2017.



  1. Scorpio

    Scorpio Скорпион Founding Member Board Elder Site Mgr Site Supporter ++

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    Why No One’s Going to Drain this Swamp
    by Wolf Richter • Mar 8, 2017 • 76 Comments

    The Financial Sector threw $2 Billion at Congress during the Election. Biggest Spenders? Not the Banks.

    The Financial Sector – whose products, risk-taking, and shenanigans blew up the sector and everything around it during the Financial Crisis – has finally gotten the memo in a serious way: During the past election cycle (2015-2016), it doused the members of the US Congress with a record amount of money to “influence decision making” and get what they want: deregulation, handouts, and subsidies.

    So how much? Over $2 billion.

    That’s over $3.7 million per sitting member of Congress, according to a report released today by Americans for Financial Reform. The $2 billion tab fell into two categories:

    • Campaign contributions by companies, trade associations, and individuals associated with the financial sector: $1.104 billion. This was “almost twice that of any other specific business sector.”
    • Lobbying expenses by 460 financial sector entities: $898 million
    “The financial sector is by far the largest source of campaign contributions to federal candidates and parties, and the third largest spender on lobbying,” the report explains, based on data by the Center for Responsive Politics (CRP), which tracks campaign contributions reported to the Federal Elections Commission (FEC) and lobbying expenditures reported to the Senate Office of Public Records.

    This “Financial Sector” includes commercial banks, S&Ls, credit unions, finance and credit companies, securities and investment firms, accountants, and “miscellaneous finance.”

    But actual amounts are much higher:
    • Entities often report this data “many months late”; contributions and lobbying expenses reported after February 8 are not included in the report.
    • “Financial Sector,” as defined by the CRP, excludes some trade associations and companies with a “very substantial financial interests,” such as the US Chamber of Commerce, which lobbies extensively on financial issues, and the National Auto Dealers Association (NADA) which lobbies on policy regarding auto loans.
    • Also excluded is “dark money” contributed to nonprofits “that engage in political advocacy in their own right but do not have to report their donors. The total amount of unreported dark-money spending is widely believed to be at least as great as reported spending.”
    So the $2 billion is a minimum. The actual total could be $4 billion, or whatever. That is starting to be real money.





    The top 20 performers:
    Who is Number 1? Goldman Sachs? Wells Fargo? Nope. The National Association of Realtors (NAR). It’s trying to get the government to inflate the housing market in myriad ways, for instance by dominating the mortgage industry, including guarantees and mortgage-backed securities, thereby subsidizing mortgage rates. It’s all about Realtors making more money because commissions are fatter if extracted from higher home prices. And the NAR is very concerned that the government might be cracking down on pandemic money laundering in the housing sector.

    The NAR gave more than twice as much as the next guy in line, namely a quant hedge fund, Renaissance Technologies, followed by another hedge fund, Paloma Partners, followed by another hedge fund, Elliot Management, followed by the banking trade association, American Bankers Association.

    Commercial banks are further down on this list (campaign contributions and lobbying expenses combined):

    1. National Association of Realtors – $118,622,462
    2. Renaissance Technologies – $53,479,983
    3. Paloma Partners – $41,334,000
    4. Elliott Management – $28,020,354
    5. American Bankers Association (ABA) – $25,750,687
    6. Bloomberg LP – $25,528,952
    7. Soros Fund Management – $24,642,840
    8. Pritzker Group – $23,668,814
    9. Prudential Financial – $19,021,920
    10. Securities Industry & Financial Market Association (SIFMA) – $16,006,600
    11. Starr Companies – $15,316,251
    12. Stephens Group – $15,193,306
    13. Citadel LLC – $14,846,004
    14. Wells Fargo – $14,755,343
    15. Citigroup Inc – $13,676,918
    16. Hendricks Holding Co – $13,499,525
    17. MetLife Inc – $13,196,824
    18. New York Life Insurance – $12,792,478
    19. Goldman Sachs – $12,414,029
    20. Investment Company Institute (ICI) – $12,382,079
    The report lists many more entities by name. These are just the top 20.

    Clearly, Goldman Sachs, near the bottom of the above list, doesn’t need to spend that much money on campaign contributions and lobbying. It gets what it wants by other means, for example having its ex-executives play major roles in the administration and at the Fed.

    This chart of the past 9 election cycles shows how overall performances have improved over the years. So this is certainly an exciting growth sector in the US economy, however crummy the rest of the economy or corporate earnings might be. It also shows how the $2 billion were divided up between “campaign contributions” and “lobbying”:

    [​IMG]

    Here are the top five recipients in the Senate:

    1. Senator Marco Rubio (R-FL) – $8,687,969
    2. Senator Ted Cruz (R-TX) – $5,482,011
    3. Senator Charles E Schumer (D-NY) – $5,345,563
    4. Senator Rob Portman (R-OH) – $4,158,259
    5. Senator Pat Toomey (R-PA) – $3,918,262
    And here are the top five recipients in the House:

    1. Representative Paul Ryan (R-WI) – $5,727,069
    2. Representative Kevin McCarthy (R-CA) – $3,397,980
    3. Representative Patrick Murphy (D-FL) – $2,218,697
    4. Representative Joe Heck (R-NV) – $2,167,660
    5. Representative Chris Van Hollen (D-MD) – $2,149,471
    The chart below shows campaign contributions to Democrats and Republicans, based on contributions that were identified by party (only a portion are), with the federal election cycle in solid columns and the in-between years in striped columns.

    [​IMG]

    The Financial Crisis is already forgotten, except the key element for the financial sector, including the housing sector: they got bailed out by the government and to a much larger extent by the Fed – and they continue to get propped up with the still ultra-low interest rates and the Fed’s gigantic pile of securities, including mortgage-backed securities, that it has acquired during the phases of QE.

    So it’s no big deal, apparently, for these players if there is another financial crisis. But deregulation must happen. Financial reforms must be rolled back. The housing market must be subsidized more than ever. Bonuses, stock-based compensation, share repurchases, and commissions beckon. What is in reality a relatively small amount of money – just a few billion bucks, a pittance really – must be spent by the industry to reap the huge payoffs. As the old saw goes, you have to spend money to make money.

    But in the real economy, where has all the optimism suddenly gone? Read… Atlanta Fed GDPNow Forecast Spirals Down in Amazing Manner

    http://wolfstreet.com/2017/03/08/fi...bying-biggest-spenders-real-estate-not-banks/
     
  2. TAEZZAR

    TAEZZAR LADY JUSTICE ISNT BLIND, SHES JUST AFRAID TO WATCH Midas Member Site Supporter

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    Lobbying = Bribery
    End lobbying - End bribery

    "If a baseball player slides into home plate and, right before the umpire rules if he is safe or out, the player says to the umpire - 'Here is $1,000.' What would we call that? We would call that a bribe. If a lawyer was arguing a case before a judge and said, 'Your honor before you decide on the guilt or innocence of my client, here is $1,000.' What would we call that? We would call that a bribe.
    "But if an industry lobbyist walks into the office of a key legislator and hands her or him a check for $1,000, we call that a campaign contribution. We should call it a bribe."

    Janice Fine - Dollars & Sense Magazine
     
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  3. Silvergun

    Silvergun Silver Member Silver Miner

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    100% accurate. I would also add that this is a non-partisan issue that both sides should get behind, which brings up the next question. Why are the American people so complacent?
     
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  4. TAEZZAR

    TAEZZAR LADY JUSTICE ISNT BLIND, SHES JUST AFRAID TO WATCH Midas Member Site Supporter

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    It may well be a non-partisan issue, but it is $$$,$$$,$$$,$$$ !!
    We will continue, as a society, to be complacent, as long as our tummies are full & our bodies are warm & dry !!
    And the politicians damned well know it !!!
     
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